Cyclophilins are a family of ubiquitous proteins that are the intracellular target of the immunosuppressant drug cyclosporin A. Although cyclophilins catalyze peptidylprolyl cis-trans isomerization in vitro, it has remained open whether they also perform this function in vivo. Here we show that Cpr3p, a cyclophilin in the matrix of yeast mitochondria, accelerates the refolding of a fusion protein that was synthesized in a reticulocyte lysate and imported into the matrix of isolated yeast mitochondria. The fusion protein consisted of the matrix-targeting sequence of subunit 9 of F1F0-ATPase fused to mouse dihydrofolate reductase. Refolding of the dihydrofolate reductase moiety in the matrix was monitored by acquisition of resistance to proteinase K. The rate of refolding was reduced by a factor of 2-6 by 2.5 microM cyclosporin A. This reduced rate of folding was also observed with mitochondria lacking Cpr3p. In these mitochondria, protein folding was insensitive to cyclosporin A. The rate of protein import was not affected by cyclosporin A or by deletion of Cpr3p.