Learning and memory require alteration in number and strength of existing synaptic connections. Extracellular proteolysis within the synapses has been shown to play a pivotal role in synaptic plasticity by determining synapse structure, function, and number. Although synaptic plasticity of excitatory synapses is generally acknowledged to play a crucial role in formation of memory traces, some components of neural plasticity are reflected by nonsynaptic changes. Since information in neural networks is ultimately conveyed with action potentials, scaling of neuronal excitability could significantly enhance or dampen the outcome of dendritic integration, boost neuronal information storage capacity and ultimately learning. However, the underlying mechanism is poorly understood. With this regard, several lines of evidence and our most recent study support a view that activity of extracellular proteases might affect information processing in neuronal networks by affecting targets beyond synapses. Here, we review the most recent studies addressing the impact of extracellular proteolysis on plasticity of neuronal excitability and discuss how enzymatic activity may alter input-output/transfer function of neurons, supporting cognitive processes. Interestingly, extracellular proteolysis may alter intrinsic neuronal excitability and excitation/inhibition balance both rapidly (time of minutes to hours) and in long-term window. Moreover, it appears that by cleavage of extracellular matrix (ECM) constituents, proteases may modulate function of ion channels or alter inhibitory drive and hence facilitate active participation of dendrites and axon initial segments (AISs) in adjusting neuronal input/output function. Altogether, a picture emerges whereby both rapid and long-term extracellular proteolysis may influence some aspects of information processing in neurons, such as initiation of action potential, spike frequency adaptation, properties of action potential and dendritic backpropagation.