The ‘secretory vesicle hypothesis of precursor processing’ states that the initial endopeptidase cleavages which excise the nascent, biologically active peptides from their protein precursors occur primarily in secretory vesicles (or granules). Hence, all the processing steps subsequent to these cleavages must also occur within these organelles. Two types of evidence are presented in support of this view: (1) cell biological studies which implicate the secretory vesicle as the site of precursor conversion to peptides, and (2) enzymological studies which locate and characterize putative processing enzymes in secretory vesicles. The processing enzymes reviewed include the ‘prohormone-converting enzymes’ which cleave at pairs of basic amino acids, other endopeptidases, carboxypeptidase-B-like enzymes and aminopeptidase, and N-acetylation and α-amidation enzymes. The properties of these enzymes in relation to the nature of the processing micro-environment in the secretory vesicles is discussed.

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