Proenkephalin and other prohormones require proteolytic processing at paired basic and monobasic residues for the biosynthesis of active neuropeptides. The novel "prohormone thiol protease" (PTP) has been proposed as a candidate proenkephalin processing enzyme for the production of [Met]enkephalin in chromaffin granules (Krieger, T. J., and Hook, V. Y. H. (1991) J. Biol. Chem. 266, 88376-8383). In this study, PTP was examined during elevation of cellular [Met]enkephalin by forskolin, a direct activator of adenylate cyclase that produces cAMP. Treatment of chromaffin cells with forskolin for 72 h increased enkephalin precursor cleaving activity (measured by following the conversion of the model substrate [35S-Met]preproenkephalin to trichloroacetic acid-soluble radioactivity) in isolated chromaffin granules by 170-180% over controls (100%). The increased activity was associated with the membrane fraction, rather than the soluble fraction, of chromaffin granules. The elevated activity was inhibited by E-64c, which is a potent inhibitor of PTP and cysteine proteases; however, the activity was not inhibited by serine or aspartic protease inhibitors. The elevated activity was identified as PTP based on immunoprecipitation by anti-PTP immunoglobulins. Stimulation of PTP synthesis was involved in the forskolin-induced increase in PTP activity, as demonstrated by a 10-fold increase in [35S]PTP pulse labeling in forskolin-treated chromaffin cells. Forskolin elevation of PTP protein levels within chromaffin granules was also detected in Western blots. Importantly, the forskolin-mediated rise in cellular [Met]enkephalin levels was completely blocked when cells were preincubated with the cysteine protease inhibitor Ep453, which is known to be converted by intracellular esterases to the more effective inhibitor E-64c (Buttle, D. J., Saklatvala, J., Tamai, M., and Barrett, A. J. (1992) Biochem. J. 281, 175-177). Both E-64c and Ep453 inhibit PTP, with E-64c being more potent (Azaryan, A. V., and Hook, V. Y. H. (1994b) Arch. Biochem. Biophys. 314, 171-177). These results demonstrate a role for PTP in proenkephalin processing in chromaffin cells and indicate that [Met] enkephalin formation and PTP are both regulated by cAMP.