Studies using antibodies to immunolocalize the Toxoplasma gondii dense granule protein GRA3, have shown that this protein associates strongly with the parasitophorous vacuole membrane (PVM). However, as there was no predicted membrane-spanning domain this highlighted an unanswered paradox. We demonstrate that the previously published sequence for GRA3 is actually an artificial chimera of 2 proteins. One protein, of molecular weight 65 kDa, shares the C-terminus with published GRA3 and possesses no significant sequence similarity with any protein thus far deposited in Genbank. The second, with a predicted molecular weight of 24 kDa shares the N-terminal region, is recognized by the monoclonal antibody 2H11 known to react with the dense granules of T. gondii and is therefore the authentic GRA3. The corrected GRA3 has an N-terminal secretory signal sequence and a transmembrane domain consistent with its insertion into the PVM. Antibodies to recombinant GRA3 recognize a protein of 24 kDa in T. gondii excretory–secretory antigen preparations. The signal peptide is necessary and sufficient to target GFP to the dense granules and parasitophorous vacuole. A homologue was identified in Neospora caninum. Finally, GRA3 possesses a dilysine ‘KKXX’ endoplasmic reticulum (ER) retrieval motif that rationalizes its association with PVM and possibly the host cell ER.