A putative prenyltransferase gene, cdpNPT, was identified in the genome sequence of Aspergillus fumigatus by a homology search by using known prenyltransferases and sequence analysis. CdpNPT consists of 440 amino acids and has a molecular mass of about 50 kDa. The coding sequence of cdpNPT was cloned in pQE60 and overexpressed in E. coli. The soluble His(6)-fusion CdpNPT was purified to near homogeneity and characterised biochemically. The enzyme showed broad substrate specificity towards aromatic substrates and was found to catalyse the prenylation of tryptophan-containing cyclic dipeptides at N1 of the indole moieties in the presence of dimethylallyl diphosphate (DMAPP); geranyl diphosphate was not accepted as prenyl donor. The structures of the enzymatic products were elucidated by NMR and MS analysis. The K(m) value for DMAPP was determined to be 650 microM. Due to substrate inhibition, K(m) values could not be obtained for the aromatic substrates. CdpNPT does not need divalent metal ions for its enzymatic reaction, although Ca(2+) enhances the reaction velocity by up to the threefold. CdpNPT is the first N-prenyltransferase that has been purified and characterised in a homogenous form after heterologous overproduction. Interestingly, it shows significant sequence similarity to other indole prenyltransferases that catalyse the formation of C--C bonds.