Rat phosphatidylinositol transfer protein (PITP) is a 32-kDa protein of 271 amino acids that transfers phosphatidylinositol and phosphatidylcholine between membranes. The alpha isoform of rat PITP was expressed in Escherichia coli and purified in high yields. The purified protein contained 1 mol of phosphatidylglycerol and had a transfer activity for phosphatidylinositol and phosphatidylcholine equal to or greater than that of PITP purified from mammalian brain. Limited protease digestion was used to further define structure, activity, and function relationships in PITP. PITP alone is relatively resistant to digestion by chymotrypsin, trypsin, and Staphylococcus V8 protease but is readily cleaved by subtilisin. Phospholipid vesicles containing phosphatidic acid enhance susceptibility to digestion by all four proteases. In the presence of vesicles, PITP, which migrates as a 36-kDa protein in SDS-polyacrylamide gel electrophoresis, is cleaved rapidly by trypsin to a form that appears to be 2-3 kDa smaller than the native form. The tryptic fragment retains partial phospholipid transfer activity and shows an enhanced affinity for phospholipid vesicles containing phosphatidic acid. Analysis of the tryptic digestion products by immunoblotting, N-terminal sequencing, and electrospray mass spectrometry showed that trypsin cleaves the C terminus of PITP at Arg253 and Arg259. Thus, removal of the C terminus enhances the affinity of PITP for vesicles and results in a dimunition of transfer activity. Overall, the data show that PITP undergoes conformation changes and that the C terminus becomes more accessible to trypsin when bound to vesicles. Hence, the C terminus is not an essential component of the membrane binding site and may be located distal to it.