Improving a particular function of molecules is often more difficult than identifying such molecules ab initio. Here, a method to acquire higher affinity and/or more functional peptides was developed as a progressive library selection method. The primary library selection products were utilized to build a secondary library composed of blocks of 4 amino acids, of which selection led to peptides with increased activity. These peptides were further converted to randomly generate paired peptides. Cathepsin E-inhibitors thus obtained exhibited the highest activities and affinities (pM order). This was also the case with cathepsin E-activating peptides, proving the methodological effectiveness. The primary, secondary, and tertiary library selections can be regarded as module-finding, module-shuffling, and module-pairing, respectively, which resembles the progression of the natural evolution of proteins. The mode of peptide binding to their target proteins is discussed in analogy to antibodies and epitopes of an antigen. Copyright © 2012 European Peptide Society and John Wiley & Sons, Ltd.