Anglerfish proinsulin and insulin were selectively labeled with [14C]isoleucine, while proglucagon, conversion intermediate(s), and glucagon were selectively labeled with [aH]tryptophan. After various periods of continuous or pulse-chase incubation, islet tissue was subjected to subcellular fractionation. Fraction extracts were analyzed by gel filtration for their content of precursor, conversion intermediate(s), and product peptides. Of the seven subcellular fractions prepared after each incubation, only the microsome and secretory granule fractions yielded significant amounts of labeled insulin-related and glucagon-related peptides. After short-pulse incubations, levels of both [14C]proinsulin and [3H]proglucagon (mol wt -12,000) were highest in the microsome fraction. This fraction is therefore identified as the site of synthesis. With increasing duration of continuous incubation or during chase incubation in the absence of isotopes, proinsulin, proglucagon, and conversion intermediate(s) are transported to secretory granules. Conversion of proinsulin to insulin and proglucagon to a -4,900 mol wt conversion intermediate and 3,500 mol wt glucagon occurs in the secretory granules. Converting activity also was observed in the microsome fraction. The recovery of most of the incorporated radioactivity in microsome and secretory granule fractions indicates that the newly synthesized islet peptides are relegated to a membranebound state soon after synthesis at the RER is completed. This finding supports the concept of intracisternal sequestration and intragranular maintenance of peptides synthesized for export from the cell of origin.Results from recent studies designed to ascertain the mode of biosynthesis of glucagon indicate that a biosynthetic precursor is involved (8,(27)(28)(29)(30)(31)(32)(33)47). Evidence from other studies performed over the last 10 yr indicates that many, if not all, peptide hormones are synthesized as peptides larger than the biologically active circulating hormone and are cleaved enzymatically before secre-