Bacteriophage T4 synthesizes proline and serine tRNA species which are derived from a common precursor RNA. The processing of this precursor RNA involves the replacement of a U-A-A terminus in serine tRNA by C-C-A prior to precursor cleavage. In the present work we have examined in detail the cleavage of T4 proline-serine precursor RNA by the previously identified ribonuclease P. Ribonuclease P accurately cleaves precursor RNA terminating in either C-C-A or U-A-A to generate the 5' termini characteristic of both mature tRNA species. These cleavages do not depend solely on the nucleotide sequence of the precursor RNA since isolated oligonucleotides spanning the cleavage sites are not substrates for the enzyme. Two types of experiments show that RNase P kinetically favors precursor RNA ending C-C-A over that ending U-A-A. Isolated preparations of precursor RNA containing the C-C-A sequence were cleaved more rapidly by RNase P than precursor RNA ending U-A-A. In addition, the serine tRNA generated by limited cleavage of a mixed population of precursor RNA ending C-C-A or U-A-A was enriched 3-fold in the C-A-A sequence relative to the starting material. Bacteriophage T4 proline-serine precursor RNA, in contrast to other tRNA precursors, accumulates in measurable amounts in wild type cells. This accumulation would appear to be a consequence of the requirement for the generation of the C-C-A sequence prior to RNase P cleavage. The enzymic specificity of RNase P in vitro therefore reflects the in vivo pathway for serine tRNA biosynthesis, where the C-C-A sequence is synthesized while the serine tRNA sequence is still a part of the large precursor RNA.