A tripeptide aldehyde protease inhibitor, benzyloxycarbonyl(Z)-Leu-Leu-leucinal (ZLLLa1), initiates neurite outgrowth in PC12 cells at an optimal concentration of 30nM. This result suggests the existence of a protease which regulates neurite formation in PC12 cells. We report here an attempt to identify this target protease in bovine brain using Z-Leu-Leu-Leu-4-methylcoumaryl-7-amide (ZLLL-MCA), in which the aldehyde moiety of ZLLLa1 was changed to 4-methylcoumaryl-7-amide to serve as a substrate for the protease. As a result, we have purified a proteasome with a molecular weight of about 660 kDa as a ZLLL-MCA degrading protease. The activity of the proteasome was inhibited efficiently by ZLLLa1, and was different from known catalytic activities of proteasome in some aspects, suggesting it to be a novel one. Thus, the proteasome may be involved in the regulation of neurite formation in PC12 cells.