The Drosophila mutant tan (t) shows reciprocal pigmentation defects compared with the ebony (e) mutant. Visual phenotypes, however, are similar in both flies: Electroretinogram (ERG) recordings lack "on" and "off" transients, an indication of impaired synaptic transmission to postsynaptic cells L1 and L2. Cloning of tan revealed transcription of the gene in the retina, apparently in photoreceptor cells. We expressed Tan in Escherichia coli and confirmed by Western blotting and mass spectroscopic analyses that Tan is expressed as preprotein, followed by proteolytic cleavage into two subunits at a conserved --Gly--Cys-- motif like its fungal ortholog isopenicillin-N N-acyltransferase (IAT). Tan thus belongs to the large family of cysteine peptidases. To discriminate expression of Tan and Ebony in retina and optic neuropils, we raised antisera against specific Tan peptides. Testing for colocalization with GMR-driven n-Syb-GFP labeling revealed that Tan expression is confined to the photoreceptor cells R1-R8. A close proximity of Tan and Ebony expression is evident in lamina cartridges, where three epithelial glia cells envelop the six photoreceptor terminals R1-R6. In the medulla, R7/R8 axonal terminals appeared lined up side by side with glial extensions. This local proximity supports a model for Drosophila visual synaptic transmission in which Tan and Ebony interact biochemically in a putative histamine inactivation and recycling pathway in Drosophila.