A novel SUMO-1/Smt3-specific isopeptidase, SMT3IP2/ Axam2 (Smt3-specific isopeptidase 2), was cloned and characterized. The catalytic domains in the carboxyl-terminal region were very much similar to those of other SUMO-1/Smt3-specific proteases, but the amino-terminal part was quite different. The enzyme specifically bound to Smt3a and Smt3b but not to SUMO-1. The SMT3IP2 expressed by Escherichia coli could cleave SUMO-1, Smt3a, or Smt3b from a SUMO-1/RanGAP1, Smt3a/RanGAP1, or Smt3b/RanGAP1 conjugate, respectively, and had the activity of a carboxyl-terminal hydrolase to produce a glycine residue in the carboxyl terminus of these ubiquitin-like proteins. The sequence data indicated that the amino acid sequence of SMT3IP2 was mostly identical to that of rat Axam, which binds to Axin and promotes the degradation of beta -catenin, although its amino-terminal region was much shorter than that of Axam. Therefore, we designated this isopeptidase SMT3IP2/Axam2. When human SW480 cells were transfected with wild-type SMT3IP2/Axam2, the beta -catenin disappeared. When the cells were transfected with the SMT3IP2/Axam2 C500A mutant, which had neither isopeptidase nor carboxyl-terminal hydrolase activity, or with the 1-352 mutant, which lacked the catalytic domain of the enzyme, again the beta -catenin disappeared, indicating that the enzyme activities were not necessary for the instability of beta -catenin in this transfection assay system and that its competition with Dvl for binding to Axin may be important for the instability of beta -catenin as suggested previously for Axam (Kadoya, T., Kishida, S., Fukui, A., Hinoi, T., Michiue, T., Asashima, M., and Kikuchi, A. (2000) J. BioL Chem. 275, 37030-37037). The involvement of its enzyme activities in the Writ signaling pathway remains to be elucidated.
