Abstract. The prohormone convertase PC2, which is thought to mediate the proteolytic conversion of many peptide hormones, has recently been shown to interact with the neuroendocrine-specific polypeptide 7B2 in Xenopus intermediate lobe (Braks, J. A. M., and G. J. M. Martens. Cell 78:263. 1994). In the present work we have stably transfected neuroendocrine cell lines with rat 7B2 constructs and found that overexpression of 27 kD 7B2 greatly facilitates the kinetics of maturation of proPC2, both in AtT-20/PC2 cells and in Rin5f cells. The half-life of conversion of proPC2 was reduced from 2.7 to 1.7 h in AtT-20/PC2 cells stably transfected with 27 kD 7B2 cDNA. The previously proposed "chaperone" domain was not sufficient for this facilitation event; however, a construct corresponding to the 21-kD 7B2 protein (which represents the naturally occurring maturation product) functioned well. A 7B2 construct in which maturation of 27 kD 7B2 to its 21-kD form was blocked was unable to facilitate maturation of proPC2.To correlate effects on PC2 maturation with the actual generation of PC2 enzymatic activity, a similar transfection of 21 kD 7B2 was performed using CHO cells previously amplified for the expression of proPC2. Enzymatic activity cleaving the fluorogenic substrate Cbz-Arg-Ser-Lys-Arg-AMC was highly correlated with the expression of immunoreactive 21 kD 7B2 in the conditioned medium; medium obtained from the parent cell line was completely inactive. Enzymatic activity was identified as PC2 on the basis of inhibition by the carboxy-terminal peptide of 7B2, which has previously been shown to represent a potent and specific PC2 inhibitor. Taken together, our in vivo results indicate that the interesting secretory protein 7B2 is a bifunctional molecule with an amino-terminal domain involved in proPC2 transport as well as activation.