Carboxypeptidase D (CPD) contains three domains with homology to other metallocarboxypeptidases. To further characterize the various domains, we constructed a series of point mutants with a critical active site Glu of duck CPD converted to Gln. The proteins were expressed in the baculovirus system, purified to homogeneity, and characterized. Point mutations within both the first and second domains eliminated enzyme activity, indicating that the third domain is inactive toward dansyl-Phe-Ala-Arg. CPD removed only the C-terminal Lys or Arg from peptides, with the first domain more efficient toward Arg and the second domain more efficient toward Lys. Peptides containing Pro in the penultimate position were poorly cleaved by either domain. Cleavage of a peptide with Ala in the penultimate position was most efficient, with the relative order Ala > Met > Ser, Phe > Tyr > Trp > Thr > Gln, Asp, Leu, Gly Ͼ Ͼ Ͼ Ͼ Pro for CPD with both domains active. There were only minor differences between the first and the second domains regarding the influence of the penultimate amino acid. The first domain was optimally active at pH 6.3-7.5, whereas the second domain was optimally active at pH 5.0 -6.5. Thus, the first and second carboxypeptidase domains have complementary enzyme activities. Furthermore, the finding that CPD with both domains active shows a broad activity to a wide range of substrates is consistent with a role for this enzyme in the processing of many proteins that transit the secretory pathway.