Group A streptococci which produce streptolysin S (SLS) contain a cellular potential hemolysin (CPH) which is precursor to extracellular SLS. Since the cellular location of CPH is unknown, protoplasts prepared with group C phage-associated lysin or mutanolysin from 18 strains of group A streptococci were fractionated into subcellular components and assayed for CPH. In all strains, most of the CPH was membrane associated, and most could not be removed from membranes by washing with buffer or 2 M LiCl. CPH remaining in the cytoplasmic fraction was sedimentable, but not associated with membrane fragments. Ribonuclease digestion neither solubilized nor inactivated CPH from membranes. Streptococcal proteinase also did not affect CPH, although it did inactivate SLS. We conclude that group A streptococci contain a major pool of CPH in the membrane and a smaller pool in the cytoplasm.