Enzymatic methyl ester formation in Escherichia coli ribosomal proteins was observed. Alkali lability of the methylated proteins and derivatization of the methyl groups as methyl esters of 3,5-dinitrobenzoate indicate the presence of protein methyl esters. The esterification reaction occurs predominantly on the 30S ribosomal subunit, with protein S3 as the major esterified protein. When the purified 30S subunit was used as the methyl acceptor, protein S9 was also found to be esterified. The enzyme responsible for the esterification of free carboxyl groups in proteins, protein methylase II (S-adenosyl-L-methionine:protein carboxyl methyltransferase, EC 2.1.1.24), was identified in E. coli Q13. This enzyme is extremely unstable when compared with that from mammalian origin. By molecular sieve chromatography, E. coli protein methylase II showed multiple peaks, with a major broad peak around 120,000 daltons and several minor peaks in the lower-molecular-weight region. Rechromatography of the major enzyme peak showed activities in several fractions that are much lower in molecular weight. The substrate specificity of the E. coli enzyme is similar to that of the mammalian enzyme. The Km value for S-adenosyl-L-methionine is 1.96 X 10(-6) M, and S-adenosyl-L-homocysteine was found to be a competitive inhibitor, with a Ki value of 1.75 X 10(-6) M.