The soluble fraction of immature peanut (Arachis hypogaea) was capable of dephosphorylating [(3)H]lysophosphatidic acid (LPA) to generate monoacylglycerol (MAG). The enzyme responsible for the generation of MAG, LPA phosphatase, has been identified in plants and purified by successive chromatography separations on octyl-Sepharose, Blue Sepharose, Superdex-75, and heparin-agarose to apparent homogeneity from developing peanuts. This enzyme was purified 5,048-fold to a final specific activity of 858 nmol min(-1) mg(-1). The enzyme has a native molecular mass of approximately 39 kD determined by gel filtration and migrates as a single band on sodium dodecyl sulfate-polyacrylamide gel electrophoresis with a subunit molecular mass of 39 +/- 1.5 kD. The K(m) values for oleoyl-, stearoyl-, and palmitoyl-sn-glycerol-3-phosphate were determined to be 28.6, 39.3, and 47.9 microM, respectively. The LPA phosphatase was specific to LPA and did not utilize any other substrate such as glycerol-3-phosphate, phosphatidic acid, or p-nitrophenylphosphate. The enzyme activity was stimulated by the low concentrations of detergents such as Triton X-100 and octylglucoside. Cations had no effect on the enzyme activity. Fatty acids, sphingosine, and sphingomyelin at low concentrations stimulated the enzyme activity. The identification of LPA phosphatase in plants demonstrates the existence of MAG biosynthetic machinery in plants.