Alanine:glyoxylate aminotransferase (AGT) is a pyridoxal-phosphate (PLP)-dependent enzyme. Its deficiency causes the hereditary kidney stone disease primary hyperoxaluria type 1. AGT is a highly stable compact dimer and the first 21 residues of each subunit form an extension which wraps over the surface of the neighboring subunit. Naturally occurring and artificial amino acid replacements in this extension create changes in the functional properties of AGT in mammalian cells, including relocation of the enzyme from peroxisomes to mitochondria. In order to elucidate the structural and functional role of this N-terminal extension, we have analyzed the consequences of its removal using a variety of biochemical and cell biological methods. When expressed in Escherichia coli, the N-terminal deleted form of AGT showed the presence of the protein but in an insoluble form resulting in only a 10% soluble yield as compared to the full-length version. The purified soluble fraction showed reduced affinity for PLP and greatly reduced catalytic activity. Although maintaining a dimer form, it was highly prone to self-aggregation. When expressed in a mammalian cell line, the truncated construct was normally targeted to peroxisomes, where it formed large stable but catalytically inactive aggregates. These results suggest that the N-terminal extension plays an essential role in allowing AGT to attain its correct conformation and functional activity. The precise mechanism of this effect is still under investigation. © 2011 Elsevier Ltd. All rights reserved.