In Arabidopsis, there are at least seven class I acylhydrolase members, which have a putative N-terminal chloroplast-targeting signal. Here, we show that all seven class I proteins are localized to the chloroplasts and hydrolyze phosphatidylcholine at the sn-1 position. However, based on their activities toward various lipids, Arabidopsis class I enzymes could be further divided into three sub-groups by substrate specificity, one with phospholipase-specific activity, another with phospholipase and galactolipase activities, and the other with broad lipolytic activity toward phosphatidylcholine, galactolipids, and triacylglycerol. These results suggest that the three sub-groups of class I acylhydrolases have specific roles in chloroplasts.