The structural basis for the lipid binding capability of Locusta migratoria apolipophorin III (apoLp-III) was assessed by characterizing the amino and carboxyl terminal halves of the protein. The native molecule (approximately 20 kDa) was deglycosylated with endoglycosidase F (molecular mass of deglycosylated species approximately 18 kDa) and cleaved with endoproteinase Arg-C to yield two fragments with molecular masses of approximately 9 kDa each. The two fragments were purified by reversed-phase HPLC and identified by mass spectrometry, amino acid analysis and N-terminal sequencing as the amino terminal (N9) and carboxyl terminal (C9) halves. Due to the apparent discrepancy of the protease digestion pattern obtained compared to that expected from the deduced amino sequence of apoLp-III cDNA, we carried out partial amino acid sequencing of the fragments and cDNA sequencing for the entire protein. Circular dichroism spectroscopy of the N9 and C9 peptides revealed that both exist in buffer in a random coil state. However, addition of trifluoroethanol, a helix-inducing agent, resulted in the formation of an alpha-helix, reflecting an innate propensity of the peptides to adopt a helical conformation. When cosonicated with dimyristoylphosphatidylcholine (DMPC) both peptides assumed an alpha-helical conformation, indicative of interaction with the phospholipid. In the presence of phospholipids, a 22 nm blue shift in Trp fluorescence emission was observed in the case of the C9 peptide, suggesting that the Trp residues are located in a more hydrophobic environment. Electron microscopy revealed that, compared to native apoLp-III, both peptides possessed a reduced ability to transform DMPC vesicles to disklike complexes.(ABSTRACT TRUNCATED AT 250 WORDS)