Modification of the single sulthydryl group of carboxypeptidase Y with one equivalent Hg -~ resulted in an inactive enzyme when assayed in the absence ofhalides regardless of the nature of the amino acid residue in the P, position of the ester substrate. Anions capable ofcomplexing with Hg ~, i.e., CI-, Br-, I-, SCN-and CN-, partially reactivated the Hg ~ modified CPD-Y to a level of 20-28% of the esterase activity of the unmodified enzyme. The concentration of anion necessary to achieve maximal activation varied and the following dissociation constants were determined: CI-: pK~ = 1.8, SCN-: pK~ = 3.4, Br-: pl~ = 3.6, I-: pK~ = 5.4, CN-: pK d > 7. The relation between activation and concentration of anion was in agreement with binding of one equivalent of anion to the enzyme bound mercury. A similar reactivation was not observed for CPD-Y partially inactivated with phenylmercuric chloride.The kinetic constants for a series of ester substrates with the general formula Bz-X-OMe, where X = amino acid residue, were determined for unmodified CPD-Y, CPD-Y modified with Hg ~ (assayed in the presence of I-) and CPD-Y reacted with phenylmercuric chloride. Unmodified CPD-Y exhibited a strong preference for substrates with hydrophobic amino acid residues, i.e., Phe, Leu, Met, and only slowly hydrolyzed substrates with hydrophilic amino acid residues, i.e., Arg, Lys, Thr, Gly. The two modified enzymes also had the highest k~JKm for substrates with hydrophobic residues. However, their relative preference for these different substrates deviated substantially from the unmodified enzyme. The increased preference for Bz-Lys-OMe when the Hg ++ modified enzyme was used and for Bz-Gly-OMe and Bz-AIa-OMe when the phenylmercuric chloride modified enzyme was used were the most pronounced changes in the specificity of CPD-Y following its modification with mercurials.