The activation of regulatory peptides by post-translational modification of their biosynthetic precursors is generally thought to occur only in neuroendocrine cells. We have selected clones of Chinese hamster ovary cells, a non-neuroendocrine cell line, which were transfected with a eukaryotic expression vector coding for the precursor for neuropeptide Y. Although the majority of the immunoreactive NPY was found in the form of pro-NPY, some degree of intracellular proteolytic processing of the precursor occurred in all clones. Part of the intracellular NPY immunoreactivity was even correctly amidated. Extracellular degradation of pro-NPY in the tissue culture medium generated immunoreactivity which corresponded in size to NPY. It is concluded that precursor processing can occur in non-neuroendocrine cells both as a biological process within the cells and as apparent processing, degradation in the tissue culture medium.