Peroxiredoxins are ubiquitously expressed proteins that reduce hydroperoxides using disulfur-reducing compounds as electron donors. Peroxiredoxins (Prxs) have been classified in two groups dependent on the presence of either one (1-Cys Prx) or two (2-Cys Prx) conserved cysteine residues. Moreover, 2-Cys Prxs, also named thioredoxin peroxidases, have peroxide reductase activity with the use of thioredoxin as biological electron donor. However, the biological reducing agent for the 1-Cys Prx has not yet been identified. We report here the characterization of a 1-Cys Prx from yeast Saccharomyces cerevisiae that we have named Prx1p. Prx1p is located in mitochondria, and it is overexpressed when cells use the respiratory pathway, as well as in response to oxidative stress conditions. We show also that Prx1p has peroxide reductase activity in vitro using the yeast mitochondrial thioredoxin system as electron donor. In addition, a mutated form of Prx1p containing the absolutely conserved cysteine as the only cysteine residue also shows thioredoxin-dependent peroxide reductase activity. This is the first example of 1-Cys Prx that has thioredoxin peroxidase activity. Finally, exposure of null Prx1p mutant cells to oxidant conditions reveals an important role of the mitochondrial 1-Cys Prx in protection against oxidative stress.