To assess the role of the 130 N-terminal amino acid residues of rat liver carnitine palmitoyltransferase I (L-CPTI) on malonyl-CoA sensitivity and binding, we constructed a series of mutants with deletions of the 18, 35, 52, 73, 83, or 129 most N-terminal amino acid residues. The deletion mutants were expressed in the yeast Pichia pastoris. We determined the effects of these mutations on L-CPTI activity, malonyl-CoA sensitivity, and binding in isolated mitochondria prepared from the yeast strains expressing the wild-type and deletion mutants. The mutant protein that lacked the first 18 N-terminal amino acid residues, Delta18, had activity and kinetic properties similar to wild-type L-CPTI, but it was almost completely insensitive to malonyl-CoA inhibition (I50 = 380 microM versus 2.0 microM). In addition, loss of malonyl-CoA sensitivity in Delta18 was accompanied by a 70-fold decrease in affinity for malonyl CoA (KD = 70 nM versus 1.1 nM) compared to wild-type L-CPTI. Deletion of the first 35, 52, 73, and 83 N-terminal amino acid residues had a similar effect on malonyl-CoA sensitivity as did the 18-residue deletion mutant, and there was a progressive reduction in the affinity for malonyl-CoA binding. By contrast, deletion of the first 129 N-terminal amino acid residues resulted in the synthesis of an inactive protein. To our knowledge, this is the first report to demonstrate a critical role for these perfectly conserved first 18 N-terminal amino acid residues of L-CPTI in malonyl-CoA sensitivity and binding.