The yellow (y) gene of Drosophila melanogaster is required for the pigmentation of larval and adult cuticle structures. The deduced y protein sequence includes two putative N-linked glycosylation sites and a putative signal peptide, suggesting that it might be a secreted molecule. Consistent with the characteristics of a secreted protein, our in vitro translation studies using RNA synthesised from the y cDNA demonstrate that the nascent y polypeptide is a preprotein that cotranslationally translocates into the endoplasmic reticulum (ER) membrane and becomes glycosylated. The N-terminal peptide is cleaved from the preprotein between the two alanine residues at positions 21 and 22, to release the final product into the lumen of the ER. Antibodies raised against the y polypeptide detect the protein starting at 13 h post-fertilization in epidermal cells and in the cuticle structures secreted by them that later become pigmented; in addition, yellow protein is detected in the cuticle structures associated with Keilin's organs. The embryonic beta-galactosidase staining pattern of a transgene, bearing a construct in which expression of the lacZ gene is driven by the y promoter, is also described and is similar to that of the y protein. Our results indicate that the y gene product is an apically secreted protein which becomes an immobilised structural component of the pigmented cuticle.