Abstract: The most popular alignment and similarity search techniques are based on the classical Smith-Waterman scoring scheme. Conservation of a single structural or functional feature between proteins may be undetectable, because the similarities tend to persist only in the key areas, consisting of residues dispersed in a non-trivial manner. We propose a novel method that finds occurrences of short similar words common to the studied sequences and handles the identified matches in a manner similar to segment-to-segment alignment [2]. Our interest in this area stems from the development of programs for fast searches with mismatches in large biological databases [1]. As shown here, these programs can support large database searches that lead to automatic domain detection, sequence annotation. The use of this technique in fold-recognition and structure prediction is being studied.