Gene 8 of bacteriophage M13 codes for procoat, the precursor of its major coat protein. Gene 8 has been cloned into a plasmid and mutagenized. We have isolated mutants of this gene in which procoat is synthesized but is not processed to coat protein. We now describe mutants in the leader region of procoat, at positions -6, -3, and -1 with respect to the leader peptidase cleavage site. These positions are quite conserved among the leader peptides of various pre-proteins. Each of these mutant procoats is synthesized at a normal rate and inserts correctly into the plasma membrane, as judged by its accessibility to protease in intact spheroplasts. Procoat accumulates, largely in its transmembrane form, and is not cleaved to coat. In detergent extracts, the mutant procoats are very poor substrates for added leader peptidase. We conclude that these 3 residues are not conserved for insertion across the membrane but are part of an essential recognition site for the leader peptidase.