The conformational state of biliproteins can be determined by optical properties of the covalently linked chromophores. Recently determined crystal structure of truncated form of α-subunit of cyanobacterial phycoerythrin (αC-PE) from Phormidium tenue provides a new insight into the structure-function relationship of αC-PE. To compare their stabilities, we have measured urea-induced denaturation transitions of the full length αC-PE (FL-αC-PE) and truncated αC-PE (Tr-αC-PE) followed by observing changes in absorbance at 565 nm, fluorescence at 350 and 573 nm, and circular dichroism at 222 nm as a function of [urea], the molar concentration of urea. The transition curve of each protein was analyzed for ΔGD(0), the value of Gibbs free energy change on denaturation (ΔGD) in the absence of urea; m, the slope (=∂∆GD/∂[urea]), and Cm, the midpoint of the denaturation curve, i.e. [urea] at which ΔGD = 0. A difference of about 10% in ΔGD(0) observed between FL-αC-PE and Tr-αC-PE, suggests that the two proteins are almost equally stable, and the natural deletion of 31 residues from the N-terminal side of the full length protein does not alter its stability. Furthermore, normalization of probes shows that the urea-induced denaturation of both the proteins is a two-state process. Folding of both structural variants (Tr-αC-PE and FL-αC-PE) of P. tenue were also studied using molecular dynamics simulations at 300 K. The results show clearly that the stability of the proteins is evenly distributed over the whole structure indicating no significant role of N-terminal residues in the stability of both proteins.