The multicellular green flagellate Volvox carteri synthesizes a periplasmic arylsulfatase in response to sulfur deprivation. The inducible enzyme has been purified to homogeneity and characterized. The corresponding gene and cDNA have been cloned. Determination of the sequence of genomic clones and comparisons to the cDNA sequence, revealed sixteen introns and seventeen exons that encode a 649-amino-acid polypeptide chain. Since the arylsulfatase enzyme is readily assayed using chromogenic substrates, but is not detectable in cells grown in sulfate-containing medium, the gene encoding arylsulfatase may be useful as a reporter gene in V. carteri. In addition, the highly regulated promoter of the arylsulfatase gene suggests its suitability as a tool for producing inducible expression vectors for cloned genes.