Staphylococcus aureus sortase anchors surface proteins to the cell wall envelope by cleaving polypeptides at the LPXTG motif. Surface proteins are linked to the peptidoglycan by an amide bond between the C-terminal carboxyl and the amino group of the pentaglycine cross-bridge. We find that purified recombinant sortase hydrolyzed peptides bearing an LPXTG motif at the peptide bond between threonine and glycine. In the presence of NH(2)-Gly(3), sortase catalyzed exclusively a transpeptidation reaction, linking the carboxyl group of threonine to the amino group of NH(2)-Gly(3). In the presence of amino group donors the rate of sortase mediated cleavage at the LPXTG motif was increased. Hydrolysis and transpeptidation required the sulfhydryl of cysteine 184, suggesting that sortase catalyzed the transpeptidation reaction of surface protein anchoring via the formation of a thioester acyl-enzyme intermediate.