Palmitoylation of the yeast vacuolar protein Vac8 is important for its role in membrane-mediated events such as vacuole fusion. It has been established both in vivo and in vitro that Vac8 is palmitoylated by the Asp-His-His-Cys (DHHC) protein Pfa3. However, the determinants of Vac8 critical for recognition by Pfa3 have yet to be elucidated. This is of particular importance because of the lack of a consensus sequence for palmitoylation. Here we show that Pfa3 was capable of palmitoylating each of the three N-terminal cysteines of Vac8 and that this reaction was most efficient when Vac8 is N-myristoylated. Additionally, when we analyzed the Src homology 4 (SH4) domain of Vac8 independent of the rest of the protein, palmitoylation by Pfa3 still occurred. However, the specificity of palmitoylation seen for the full-length protein was lost, and the SH4 domain was palmitoylated by all five of the yeast DHHC proteins tested. These data suggested that a region of the protein C-terminal to the SH4 domain was important for conferring specificity of palmitoylation. This was confirmed by use of a chimeric protein in which the SH4 domain of Vac8 was swapped for that of Meh1, another palmitoylated and N-myristoylated protein in yeast. In this case we saw specificity mimic that of wild type Vac8. Competition experiments revealed that the 11th armadillo repeat of Vac8 is an important element for recognition by Pfa3. This demonstrates that regions distant from the palmitoylated cysteines are important for recognition by DHHC proteins.