The number, diversity and significance of peptides as regulators of cellular differentiation, growth, development and defence of plants has long been underestimated. Peptides have now emerged as an important class of signals for cell-to-cell communication over short distances, and also for long-range signalling. We refer to these signalling molecules as peptide growth factors and peptide hormones, respectively. As compared to remarkable progress with respect to the mechanisms of peptide perception and signal transduction, the biogenesis of signalling peptides is still in its infancy. This review focuses on the biogenesis and activity of small post-translationally modified peptides. These peptides are derived from inactive pre-pro-peptides of approximately 70-120 amino acids. Multiple post-translational modifications (PTMs) may be required for peptide maturation and activation, including proteolytic processing, tyrosine sulfation, proline hydroxylation and hydroxyproline glycosylation. While many of the enzymes responsible for these modifications have been identified, their impact on peptide activity and signalling is not fully understood. These PTMs may or may not be required for bioactivity, they may inactivate the peptide or modify its signalling specificity, they may affect peptide stability or targeting, or its binding affinity with the receptor. In the present review, we will first introduce the peptides that undergo PTMs and for which these PTMs were shown to be functionally relevant. We will then discuss the different types of PTMs and the impact they have on peptide activity and plant growth and development. We conclude with an outlook on the open questions that need to be addressed in future research.