Synaptosome-associated proteins SNAP-23/25, members of a family of proteins essential for exocytosis, have a highly conserved central cysteine-rich domain that plays an important role in membrane targeting. More than one cysteine in this domain is modified by palmitic acid through a thioester linkage. In an effort to address the biological significance of acylation of this domain, we have generated synthetic peptides corresponding to the cysteine-rich region of SNAP-23 and covalently modified the cysteines with palmitic acid. The interaction of acylated and nonacylated peptides with lipid vesicles and natural membranes has been investigated. Our results indicate that palmitoylation is essential for membrane association. The palmitoylated peptides were able to fuse both model and natural membranes. The extent of fusion depended on the length of the peptides and the number and positions of covalently linked palmitic acids. Peptide-mediated fusion was suppressed by lysolipid and involved both outer and inner leaflets of the lipid bilayer, which is characteristic of natural membrane fusion. Our results suggest an important role for the cysteine-rich palmitoylated domain of SNAP-23 in promoting membrane fusion in cells.The mixing of specific membrane compartments by the process of fusion is a highly regulated event in eukaryotic cells. The fusion process is exquisitely controlled in a manner that does not disturb the structural and functional identity of organelles (1, 2). Several proteins that are involved at different steps in the transport process, from the formation of a transport vesicle until its fusion with the target membrane, have been identified (3-7). The SNARE 1 proteins play a crucial role in the process of intracellular membrane fusion. For fusion to occur, transport vesicles with distinct v-SNAREs have to pair with cognate t-SNAREs at the appropriate target membrane. Syntaxin and SNAP-23/25 are members of the t-SNARE family of proteins, whereas synaptobrevin/vesicle-associated membrane protein are v-SNARE proteins (3-7).Syntaxin, SNAP-25, and vesicle-associated membrane proteins mediate fusion through the formation of helical bundles that span opposing membranes. Hydrophobic C-terminal domains anchor syntaxin and vesicle-associated membrane proteins to the lipid bilayer of the plasma and vesicle membranes, respectively. The crystal structure of the SNARE complex has identified the regions of SNAP-25 that are involved in binary and ternary interactions (8, 9). SNAP-25 and its non-neuronal homolog, syndet/SNAP-23 (10, 11) possess cysteine residues clustered in a relatively unstructured segment between two helical domains. The cysteine residues in this segment are palmitoylated (12)(13)(14). Mutants of syndet and SNAP-25 lacking cysteines, and therefore not palmitoylated, are localized predominantly in the cytoplasm of transfected cells (15,16). Based on mutagenesis of SNAP-25, a minimal plasma membranetargeting domain composed of residues 85-120 has been identified. This segment has the ability to target...