Although mitotic cyclins are well-known substrates for ubiquitin-mediated proteolysis at the metaphase-anaphase transition, their degradation is not essential for separation of sister chromatids; several lines of evidence suggest that proteolysis of other protein(s) is required, however. Here we report the anaphase-specific proteolysis of the Schizosaccharomyces pombe Cut2 protein, which is essential for sister-chromatid separation. Cut2 is located in the nucleus, where it is concentrated along the short metaphase spindle. The rapid degradation of Cut2 at anaphase requires its amino-terminal region and the activity of Cut9 (ref. 14), a component of the 20S cyclosome/anaphase-promoting complex (APC), which is necessary for cyclin destruction. Expression of non-degradable Cut2 blocks sister-chromatid separation but not cell-cycle progression. This defect can be overcome by grafting the N terminus of cyclin B onto the truncated Cut2, demonstrating that the regulated proteolysis of Cut2 is essential for sister-chromatid separation.