On the basis of the identity of a segment of the amino acid sequence within the active site of the bacterial enzyme thermolysin and the mammalian enzyme neutral endopeptidase 24.11, the possible involvement of valine-573 of neutral endopeptidase 24.11 in substrate binding was investigated. Valine-573 was changed to leucine and to alanine by site-directed mutagenesis. The effect of these mutations on inhibitor binding and substrate catalysis was examined with a series of compounds containing variable P'1 residues. With a small P'1 residue such as alanine, both mutant enzymes exhibited kinetic properties essentially the same as the wild-type enzyme. However, with larger P'1 residues such as phenylalanine, tyrosine, and leucine, the Val573Leu mutant showed a 24-100-fold decrease in inhibitor affinity. Similarly substrates containing bulky P'1 residues showed a 10-40-fold decrease in Vmax with little change in Km. In contrast, the Val573Ala mutant showed only modest changes in terms of inhibitor binding or substrate turnover. These results support the proposed role of valine-573 as a part of the hydrophobic binding pocket, S'1 binding subsite, of neutral endopeptidase 24.11.