The malp gene of Mycoplasma fermentans is shown to occur in single copy but to encode two discrete translated forms of lipid-modified surface protein that can be differentially expressed on isolates within this species: MALP-2, a 14-amino-acid (2-kDa) lipopeptide with potent macrophage-stimulatory activity (P. F. Mühlradt, M. Kiess, H. Meyer, R. Süssmuth, and G. Jung, J. Exp. Med. 185:1951–1958, 1997), and MALP-404, an abundant, full-length (404-amino-acid) surface lipoprotein of 41 kDa, previously designated P41 (K. S. Wise, M. F. Kim, P. M. Theiss, and S.-C. Lo, Infect. Immun. 61:3327–3333, 1993). The sequences, transcripts, and translation products of malp were compared between clonal isolates of strains PG18 (known to express P41) and II-29/1 (known to express high levels of MALP-2). Despite conserved malp DNA sequences containing full-length open reading frames and expression of full-length monocistronic transcripts in both isolates, Western blotting using a monoclonal antibody (MAb) to the N-terminal MALP-2 peptide revealed marked differences in the protein products expressed. Whereas PG18 expressed abundant MALP-404 with detectable MALP-2, II-29/1 revealed no MALP-404 even in samples containing a large comparative excess of MALP-2. Colony immunoblots with the MAb showed uniform surface expression of MALP-2 in II-29/1 populations. A second MAb to an epitope of MALP-404 outside the MALP-2 sequence predictably failed to stain II-29/1 colonies but uniformly stained PG18 populations. Collectively, these results provide evidence for novel posttranscriptional (probably posttranslational) processing pathways leading to differential intraspecies expression of a major lipoprotein, and a potent macrophage-activating lipopeptide, on the surface of M. fermentans. In the course of this study, a striking conserved motif (consensus, TD-G--DDKSFNQSAWE--), designated SLA, was identified in MALP-404; this motif is also distributed among selected lipoproteins and species from diverse bacterial genera, including Bacillus, Borrelia, Listeria, Mycoplasma, and Treponema. In addition, malp was shown to flank a chromosomal polymorphism. In eight isolates of M. fermentans examined, malp occurred upstream of an operon encoding the phase-variable P78 ABC transporter; but, in three of these isolates, a newly discovered insertion sequence, IS1630 (of the IS30 class), was located between these genes.