We have described an enzyme in brain that catabolizes galactocerebroside sulfatide with a pH optimum of 7.2. To our knowledge, this is the first description of a catabolic enzyme for sulfatide at a neutral pH. Activity at a neutral pH implies a non-lysosomal location for this sulfatidase. Galactocerebroside sulfate sulfatidase (n-sulfatidase) activity was not apparent in crude microsomal extracts and was detected following partial purification of the enzyme. This enzyme, n-sulfatidase, differs from other arylsulfatases in its M(r), inability to bind to concanavalin A, and substrate specificity; n-sulfatidase was unable to hydrolyze p-nitrocatechol sulfate or estrone sulfate. The molecular mass of n-sulfatidase obtained by Sephacryl S-200 chromatography was 72 kDa, and the active fraction from this procedure was purified > 600-fold by isoelectric focusing. Following SDS-polyacrylamide gel electrophoresis, two bands were obtained with apparent molecular masses of 58 and 66 kDa. Enzyme activity was regenerated from both of these bands, with the 66-kDa band showing greater activity. The Km of the sulfatidase was determined as 5.8 x 10(-5) M. The pI of n-sulfatidase was 7.7 in contrast to the pI of 4.9 for the sulfotransferase. No requirement was found for Mg2+ or ATP for sulfatidase activity; vitamin K1 enhanced sulfatidase activity approximately 3.3-fold. Therefore, this enzyme may have a role in the pathogenesis of metachromatic leukodystrophy in which sulfatides accumulate in the nervous and other tissues and in myelination since sulfatides are an important component of myelin.