We have isolated and purified to homogeneity an alpha,alpha'-trehalose 6-monomycolate:alpha,alpha'-trehalose mycolyltransferase (trehalose mycolyltransferase) from Mycobacterium smegmatis that catalyzes the exchange of a mycolyl group between trehalose, trehalose 6-monomycolate (TM), and trehalose 6,6'-dimycolate (TD). This enzyme was prominent in M. smegmatis and it catalyzed the following reactions. TM + [14C]trehalose in equilibrium [14C]TM + trehalose [14C]TM + TM in equilibrium [14C]TD + trehalose This enzyme was purified by (i) ammonium sulfate fractionation, (ii) QAE-Sephadex A-50 column chromatography, (iii) gel filtration on a Sephadex G-75 column, and (iv) SP-Sephadex C-50 column chromatography. The purified protein yielded a single band on sodium dodecyl sulfate-polyacrylamide gel electrophoresis, and its molecular weight was estimated to be 25,000. This enzyme was a glycoprotein, had no cofactor requirement, and was highly specific for alpha,alpha'-trehalose as the mycolate acceptor. It was less specific for the acyl donor group since the palmitoyl group in trehalose 6-monopalmitate was easily exchangeable. There was no TM acylhydrolase activity in the purified enzyme, suggesting that it is probably associated with the anabolic pathway of mycolic acid metabolism. We postulate the formation of a mycolyl-enzyme intermediate in this reaction. Such an intermediate could play a central role in the transfer of mycolic acid to form the prominent cell wall components of mycobacterial TD and possibly murein-arabinogalactan-mycolate.