Escherichia coli signal peptide peptidase A (SppA) is a serine protease which cleaves signal peptides after they have been proteolytically removed from exported proteins by signal peptidase processing. We present here results of site-directed mutagenesis studies of all the conserved serines of SppA in the carboxyl-terminal domain showing that only Ser 409 is essential for enzymatic activity. Also, we show that the serine hydrolase inhibitor FP-biotin inhibits SppA and modifies the protein but does not label the S409A mutant with an alanine substituted for the essential serine. These results are consistent with Ser 409 being directly involved in the proteolytic mechanism. Remarkably, additional site-directed mutagenesis studies showed that none of the lysines or histidine residues in the carboxyl-terminal protease domain (residues 326-549) is critical for activity, suggesting this domain lacks the general base residue required for proteolysis. In contrast, we found that E. coli SppA has a conserved lysine (K209) in the N-terminal domain (residues 56-316) that is essential for activity and important for activation of S409 for reactivity toward the FP-biotin inhibitor and is conserved in those other bacterial SppA proteins that have an N-terminal domain. We also performed alkaline phosphatase fusion experiments that establish that SppA has only one transmembrane segment (residues 29-45) with the C-terminal domain (residues 46-618) protruding into the periplasmic space. These results support the idea that E. coli SppA is a Ser-Lys dyad protease, with the Lys recruited to the amino-terminal domain that is itself not present in most known SppA sequences.