Peptidase M20 family, uncharacterized subfamily of bacterial proteins predicted as putative amidohydrolases or hippurate hydrolases. These are a class of zinc binding homodimeric enzymes involved in hydrolysis of N-acetylated proteins. N-terminal acetylation of proteins is a widespread and highly conserved process that is involved in protection and stability of proteins. Several types of aminoacylases can be distinguished on the basis of substrate specificity. Aminoacylase 1 (ACY1) breaks down cytosolic aliphatic N-acyl-alpha-amino acids (except L-aspartate), especially N-acetyl-methionine and acetyl-glutamate into L-amino acids and an acyl group. However, ACY1 can also catalyze the reverse reaction, the synthesis of acetylated amino acids. ACY1 may also play a role in xenobiotic bioactivation as well as the inter-organ processing of amino acid-conjugated xenobiotic derivatives (S-substituted-N-acetyl-L-cysteine).