The prostate-specific antigen (PSA) is a serine protease that is over-expressed in prostate carcinoma and represents a molecular target for selectively releasing an anticancer agent from a prodrug formulation. We have recently investigated a macromolecular prodrug strategy for improved cancer chemotherapy based on 2 features: (i) rapid and selective binding of thiol-reactive prodrugs to the cysteine-34 position of endogenous albumin after intravenous administration, and (ii) enzymatic release of the albumin-bound drug at the tumor site (Mansour et al., Cancer Res 2003, 63, 4062–4066). In this work, we describe an albumin-binding prodrug, EMC-Arg-Ser-Ser-Tyr-Tyr—Ser-Arg-DOXO [EMC: ϵ-Maleimidocaproic acid; DOXO = doxorubicin; X = amino acid] that is cleaved by PSA. Because of the incorporation of 2 arginine residues, the prodrug exhibited excellent water-solubility and was rapidly and selectively bound to endogenous albumin. Incubation studies with PSA and tumor homogenates from PSA-positive tumors (LNCaP) demonstrated that the albumin-bound form of the prodrug was efficiently cleaved by PSA at the P1–P′ 1 scissile bond releasing the doxorubicin dipeptide H-Ser-Arg-DOXO, which was further degraded to doxorubicin as the final cleavage product. In cell culture experiments, the prodrug was ∼100-fold less active against LNCaP cells than the free drug. In contrast, in a mouse model of human prostate cancer using luciferase transduced LNCaP cells orthotopically implanted in SCID mice, the prodrug showed enhanced antitumor efficacy when compared to doxorubicin. Doxorubicin treatment at a dose of 2 × 4 mg/kg caused significant weight loss and mortality (−25%), and did not result in a significant antitumor response at the end of the experiment. The prodrug at 3 × 12 mg/kg doxorubicin equivalents, however, was well tolerated and induced a significant reduction in tumor size of 62% (±25%, **p = 0.003) as well as a decrease of the metastatic burden in the lungs as detected in luciferase assays (−50%, SD ± 115%, *p = 0.038). © 2007 Wiley-Liss, Inc.