The gene mutated in the human genetic disorder ataxia-telangiectasia codes for a protein, ATM, the known functions of which include response to DNA damage, cell cycle control, and meiotic recombination. Consistent with these functions, ATM is predominantly present in the nucleus of proliferating cells; however, a significant proportion of the protein has also been detected outside the nucleus in cytoplasmic vesicles. To understand the possible role of extra-nuclear ATM, we initially investigated the nature of these vesicles. In this report we demonstrate that a portion of ATM co-localizes with catalase, that ATM is present in purified mouse peroxisomes, and that there are reduced levels of ATM in the post-mitochondrial membrane fraction of cells from a patient with a peroxisome biogenesis disorder. Furthermore the use of the yeast two-hybrid system demonstrated that ATM interacts directly with a protein involved in the import of proteins into the peroxisome matrix. Because peroxisomes are major sites of oxidative metabolism, we investigated catalase activity and lipid hydroperoxide levels in normal and A-T fibroblasts. Significantly decreased catalase activity and increased lipid peroxidation was observed in several A-T cell lines. The localization of ATM to peroxisomes may contribute to the pleiotropic nature of A-T.