Functional investigation of the proposed dehydratase domain of ATX, a 6-methylsalicylic acid synthase from Aspergillus terreus, revealed that the domain is not involved in dehydration of the -hydroxytriketide intermediate tethered on the acyl carrier protein but catalyzes thioester hydrolysis to release the product from the acyl carrier protein. Thus, we renamed this domain the thioester hydrolase (TH) domain. The intermediate bound to the TH domain of mutant H972A formed in the presence of NADPH was released as 6-methylsalicylic acid by both the intact ATX and by THID (a 541-amino acid region containing TH domain and its downstream) protein, in trans. Furthermore, THID showed a catalytic activity to hydrolyze a model substrate, 6-methylsalicylic acid-N-acetylcysteamine. The TH domain is the first example of a product-releasing domain that is located in the middle of a multidomain iterative type I polyketide synthase. Moreover, it is functionally different from serine protease-type thioesterase domains of iterative type I polyketide synthases.Iterative type I polyketide synthases (iPKSs) 3 are large multifunctional enzymes consisting of the minimum catalytic domains for PKS reactions, the -ketoacyl synthase (KS), acyl transferase (AT) and acyl carrier protein (ACP) domains, and additional domains such as a ketoreductase (KR), dehydratase (DH), enoylreductase (ER), methyltransferase, and thioesterase (TE) domain. Through iterative use of these domains in a programmed manner, each iPKS produces its specific polyketide product. However, little is known how iPKSs control their reactions (1).6-Methylsalicylic acid synthase (MSAS) was the first PKS to be purified and the first fungal iPKS whose gene was cloned (2-6). A conserved domain search indicated that MSAS consists of KS, AT, DH, KR, and ACP domains (5, 7). These domains of MSAS are thought to catalyze a series of programmed reactions, Claisen condensations, reduction, dehydration, cyclization, and product release (Fig. 1).Because MSAS is one of the simplest iPKSs, we have been studying its catalytic mechanism using ATX cloned from Aspergillus terreus (8). We previously carried out the expression of catalytic domain mutants of ATX in yeast. The KS mutant (KSm), AT domain mutant (ATm), and ACP mutant (ACPm) lost 6-methylsalicylic acid (6MSA) production, and the KR domain mutant (KRm) produced triacetic acid lactone as reported (9).The DH domain of ATX was assigned by comparison of secondary structural elements predicted by PredictProtein with discrete DHs of type II fatty acid synthase (FAS) from Escherichia coli (10). The conserved DH domain motif, HXXXGXXXXP, has been identified in FAS DH, in which the histidine residue is a catalytic residue for dehydration, (11) and the corresponding sequence H 972 XXXGXXXXP 981 was found in ATX. This His 972 is crucial for ATX reaction as indicated by our previous result that the ATX H972A mutant (DHm) did not give any product, such as the -hydroxy triketide (9).Because MSAS has no apparent TE domain, it has been one of...