DIABLO/Smac is a mitochondrial protein that can promote apoptosis by promoting the release and activation of caspases. To do so, DIABLO/Smac must first be processed by a mitochondrial protease and then released into the cytosol, and we show this in an intact cellular system. We propose that the precursor form of DIABLO/Smac enters the mitochondria through a stop-transfer pathway and is processed to its active form by the inner membrane peptidase (IMP) complex. Catalytic subunits of the mammalian IMP complex were identified based on sequence conservation and functional complementation, and the novel sequence motif RX5P in Imp1 and NX5S in Imp2 distinguish the two catalytic subunits. DIABLO/Smac is one of only a few specific proteins identified as substrates for the IMP complex in the mitochondrial intermembrane space.