The S-layer glycoprotein is the sole component of the protein shell surrounding Haloferax volcanii cells. The deduced amino acid sequence of the S-layer glycoprotein predicts the presence of a C-terminal membrane-spanning domain. However, several earlier observations, including the ability of EDTA to selectively solubilize the protein, are inconsistent with the presence of a trans-membrane sequence. In the present report, sequential solubilization of the S-layer glycoprotein by EDTA and then with detergent revealed the existence of two distinct populations of the S-layer glycoprotein. Whereas both S-layer glycoprotein populations underwent signal peptide cleavage and N-glycosylation, base hydrolysis followed by mass spectrometry revealed that a lipid, likely archaetidic acid, modified only the EDTA-solubilized version of the protein. These observations are consistent with the S-layer glycoprotein being initially synthesized as an integral membrane protein and subsequently undergoing a processing event in which the extracellular portion of the protein is separated from the membrane-spanning domain and transferred to a waiting lipid moiety.