Studies on a 2′,3′-cyclic nucleotide-3′-phosphohydrolase are presented. Bovine brain white matter was fractionated by differential centrifugation and sucrose density gradient techniques. The phosphohydrolase was distributed throughout all primary fractions: nuclear, mitochondrial, and microsomal. When these fractions were subjected to sucrose density gradient centrifugation the enzyme appeared only in the myelin-containing layers. Brains of newborn rats were essentially devoid of phosphohydrolase activity and the content rose rapidly during the 12th and 25th days, coinciding precisely with the development of myelin. Mutant 'quaking' mice whose brains are partially deficient in myelin were also partially deficient in enzyme activity. The data provide evidence that the phosphohydrolase is associated with myelin.The enzyme opens the cyclic phosphodiester linkage of Ap(Ap)2A cyclic P and Ap(Ap)6A cyclic P without rupture of internucleotide bonds. The enzyme also hydrolyzed the 2′,3′-cyclic phosphorothioates of uridine and guanosine. The Km for adenosine 2′,3′-cyclic phosphate was determined to be 1.9 × 10−3 M, an inordinately high value, and since nothing is known about the physiological role of the enzyme, the possibility is raised that the true substrate may not be a cyclic nucleotide.