Abstract : Prohormone convertase (PC) 2 plays an important role in the processing of neuropeptide precursors via the regulated secretory pathway in neuronal and endocrine tissues. PC2 interacts with 7B2, a neuroendocrine protein that is cleaved to a 21-kDa domain involved in proPC2 maturation and a carboxyl-terminal peptide (CT peptide) that represents a potent inhibitor of PC2 in vitro. A role for the CT peptide as an inhibitor in vivo has not yet been established. To study the involvement of the CT peptide in PC2-mediated cleavages in neuroendocrine cells, we constructed a mutant proenkephalin (PE) expression vector containing PE with its carboxyl-terminal peptide (peptide B) replaced with the 7B2 inhibitory CT peptide. This PECT chimera was stably transfected into two PC2-expressing cell lines, AtT-20/PC2 and Rin cells. Although recombinant PECT proved to be a potent (nM) inhibitor of PC2 in vitro, cellular PC2-mediated cleavages of PE were not inhibited by the PECT chimera, nor was proopiomelanocortin cleavage (as assessed by adrenocorticotropin cleavage to α-melanocyte-stimulating hormone) inhibited further than in control cells expressing only the competitive substrate PE. Tests of stimulated secretion showed that both the CT peptide and the PE portion of the chimera were stored in regulated secretory granules of transfected clones. In both AtT-20/PC2 and Rin cells expressing the chimera, the CT peptide was substantially internally hydrolyzed, potentially accounting for the observed lack of inhibition. Taken together, our data suggest that overexpressed CT peptide derived from PECT is unable to inhibit PC2 in mature secretory granules, most likely due to its inactivation by PC2 or by other enzyme(s).