CoA synthase mediates the last two steps in the sequence of enzymatic reactions, leading to CoA biosynthesis. We have recently identified cDNA for CoA synthase and demonstrated that it encodes a bifunctional enzyme possessing 4'-phosphopantetheine adenylyltransferase and dephospho-CoA kinase activities. Molecular cloning of CoA synthase provided us with necessary tools to study subcellular localization and the regulation of this bifunctional enzyme. Transient expression studies and confocal microscopy allowed us to demonstrate that full-length CoA synthase is associated with the mitochondria, whereas the removal of the N-terminal region relocates the enzyme to the cytosol. In addition, we showed that the N-terminal sequence of CoA synthase (amino acids 1-29) exhibits a hydrophobic profile and targets green fluorescent protein exclusively to mitochondria. Further analysis, involving subcellular fractionation and limited proteolysis, indicated that CoA synthase is localized on the mitochondrial outer membrane. Moreover, we demonstrate for the first time that phosphatidylcholine and phosphatidylethanolamine, which are the main components of the mitochondrial outer membrane, are potent activators of both enzymatic activities of CoA synthase in vitro. Taken together, these data provide the evidence that the final stages of CoA biosynthesis take place on mitochondria and the activity of CoA synthase is regulated by phospholipids.