Scytalidoglutamic peptidase (SGP) is the prototype of fungal glutamic peptidases that are characteristically pepstatin insensitive. These enzymes have a unique catalytic dyad comprised of Gln 53 and Glu 136 that activate a bound water molecule for nucleophilic attack on the carbonyl carbon atom of the scissile peptide bond. The hydrolysis by SGP at peptide bonds with proline in the P 1 position is a rare event among peptidases that we investigated using the series of fluorescence resonance energy transfer peptides, Abz-KLXPSKQ-EDDnp, compared with the series Abz-KLXSSKQ-EDDnp. The preference observed in these two series for Phe and His over Leu, Ile, Val, Arg, and Lys, seems to be related to the structure of the S 1 subsite of SGP. These results and the pH profiles of SGP activity showed that its S 1 subsite can accommodate the benzyl group of Phe at pH 4 as well as the positively charged imidazolium group of His. In the pH range 2 to 7, SGP maintains its structure and activity, but at pH 8 or higher it is irreversibly denatured. The intrinsic fluorescence of the Trp residues of SGP were sensitive to the titration of carboxyl groups having low pK values; this can be attributed to the buried Asp 57 and/or Asp 43 as described in SGP three-dimensional structure. The solvent kinetic isotope effects and the proton inventory experiments support a mechanism for the glutamic peptidase SGP that involves the nucleophilic attack of the general base (Glu 136 ) activated water, and establish a fundamental role of the S 1 subsite interactions in promoting catalysis.The recently established glutamic peptidase family (Family G1 in MEROPS, also known as the Eqolisins) is a novel group of acid peptidases having structures and mechanistic features distinct from the canonical peptidase families (1, 2), and so far, found only in the filamentous fungi (3) where they play key roles in fungal growth (4). Glutamic peptidases were first differentiated from aspartic peptidases as being insensitive to pepstatin and the absence of sequence similarity to the well characterized pepsin-like and retroviral aspartic peptidases (5, 6).The Scytalidoglutamic peptidase (SGP), 2 isolated from the wood-degrading fungus Scytalidium lignicolum, is the prototype of glutamic peptidases. Gln 53 and Glu 136 (in SGP numbering) were proposed to participate in the catalytic process because the single point mutants E136A, Q53A, and Q53E lost both the autoprocessing and the enzymatic activities (7). Sitedirected mutagenesis studies on Aspergillus niger glutamic peptidase established that these same residues constitute the catalytic dyad in this peptidase (8). The molecular structure of SGP was determined in its unbound native form, in complex with hydrolytic products and transition state peptide analogues (1, 9, 10). SGP has a unique -strand tertiary structure among the known peptidases, and each layer of the sandwich is formed by seven antiparallel -sheets. The catalytic residues Glu 136 and Gln 53 are both located in the same layer of the sandwich structure...