Carboxy (C)-terminal processing proteases (CTP) are a relatively new group of serine proteases. Found in a broad range of organisms - bacteria, archaea, algae, plants and animals - these proteases are involved in the C-terminal processing of proteins. In comparison with amino-terminal processing of bacterial proteins, less is known about C-terminal processing and its physiological function. Bacterial CTPs appear to influence different basal cellular processes. Although CTPs of Gram-negative bacteria are generally referred to as being localized in the periplasm, there is little experimental evidence for this. We show for the first time the subcellular localization of a CTP-3 family protein from Pseudomonas aeruginosa, named CtpA, in the periplasm by a carefully designed fractionation study. Our results provide experimental evidence for the generally accepted hypothesis that CTPs are located in the periplasmic space of Gram-negative bacteria.