Intracellular distribution, purification and properties of a folyl poly-gamma-glutamyl carboxypeptidase (peptidyl-L-glutamate hydrolase, EC 3.4.12.10) from chicken liver have been investigated. The post-nuclear particulate and cell supernatant fractions showed activity. The particulate enzyme exhibited characteristics suggestive of its lysosomal origin; on solubilization, however, it cannot be distinguished from the cell cytosol activity. The bulk enzyme was purified about 80-fold to apparent homogeneity by 50--90% ammonium sulfate fractional precipitation, dialysis and chromatography on a 'mixed column' of Sephadex G-100 superimposed on CM-Sephadex C-50. The purified enzyme behaved homogeneously on Sephadex G-100 chromatography, sucrose density gradient centrifugation analyses and polyacrylamide gel electrophoresis. However, polyacrylamide gel electrophoresis in the presence of mercaptoethanol dissociated the native enzyme into two separable isoenzymic components. The enzyme exhibits two pH optima (4.1 and 5.2) and a temperature optimum of 35--40 degrees C. The reaction is linear for 20 min. The enzyme sequentially cleaves the terminal gamma-glutamyl residues of polyglutamylfolates, finally releasing a monoglutamyl end-product. An apparent Km value of 0.83 - 10(-6) M and a V of 1.50 mmol/min were determined for N5-methyltetrahydropteroyltetraglutamate with 0.20 mg enzyme protein/ml reaction. The enzyme is substantially stimulated in the presence of mercaptoethanol, Na+, Mn2+ and low concentrations of denaturing agents (urea). Citrate potently inhibits and phosphate inactivates the enzyme.