Microsomal preparations from the stalk median eminence of female rats are shown to contain an enzymic activity that is responsible for the formation of MSH-release-inhibiting factor (MSH-R-IF). The amount of this activity remains constant throughout the estrous cycle. The corresponding mitochondrial preparations from the stalk median eminence contain another enzymic principle, estrous cycle-dependent, which competes with the enzyme present in the microsomal preparation for the same "substrate", and can thereby prevent the formation of MSH-R-IF.Several neurohypophyseal hormones, analogs, and peptide intermediates have been tested for their intrinsic MSH-R-IF activity and for their ability to be transformed into MSH-R-IF by incubation with microsomal preparations of stalk median eminence from male rats; it is concluded that the enzyme responsible for the formation of MSH-R-IF is an exopeptidase and that the release-inhibiting factor itself is a tripeptide. Oxytocin is converted by the incubation to L-prolyl-L-leucylglycinamide; nanogram amounts of this tripeptide inhibit the release of MSH from the pituitary both in vivo and in vitro.Rat hypothalamus contains a factor (MSH-R-IF) that inhibits the release of melanocyte-stimulating hormone (1, 2). Evidence for the enzymic formation of this factor has been presented (3). In male rats the pituitary content of MSH remains constant, whereas in females it fluctuates as a function of the estrous cycle (4).This last-mentioned finding was the point of departure for investigating the manner in which pituitary MSH content reflects a change in the enzymic activities responsible for the control of MSH-R-IF formation. We show that a microsomal exopeptidase in the hypothalamus degrades oxytocin, liberating the hormonal C-terminal tripeptide, prolyl-leucylThis work has been performed in C6rdoba and New York. Therefore, different strains of rats and of toads (Bufo arenarum, Bufo marinus) were employed. Since the results obtained in the two laboratories showed no discrepancies, combined publication was agreed upon.Abbreviations of amino-acid derivatives and peptides are in accordance with the IUPAC-IUB Tentative Rules on Biochemical Nomenclature, Biochemistry, 5, 2485Biochemistry, 5, , 1445Biochemistry, 5, (1966 6, 362 (1967