Type III integral membrane proteins are oriented in the membrane with their C-terminus in the cytoplasm and their N-terminus extracytoplasmic. Such proteins are believed to have an internal hydrophobic sequence that functions both as an uncleaved signal for membrane insertion and also to anchor the protein in the membrane. However, type III proteins are relatively rare, and information about their putative signal-anchor (SA) domains is scant. The adenovirus E3-6.7K protein is a novel small type III protein. In order to study the insertion of 6.7K into membranes, we have constructed a fusion protein between 6.7K and adenovirus E3-gp19K; gp19K is a type I integral membrane protein that is known to form a complex with class I antigens of the major histocompatibility complex (MHC). The 6.7K-gp19K fusion protein lacks the gp19K signal sequence. We show that the 6.7K sequences can act as signal for membrane insertion of the 6.7K-gp19K fusion protein; however. the SA domain of 6.7K does not function as an anchor for the fusion protein. Thus, we have separated the signal function from the anchor function of the 6.7K SA domain. The transmembrane domain of gp19K is still acting as a stop-transfer sequence, and the ability of gp19K to bind MHC class I antigens is still intact. These data imply that sequences flanking a SA domain can influence whether the SA domain functions as a signal sequence only or as a dual signal-anchor sequence. The results also show that the signal for a type III membrane protein can direct a type I protein into the ER membrane. Finally, the data demonstrate that gp19K can retain its class I antigen binding function when gp19K has heterologous sequences fused to its N-terminus.