Islet amyloid polypeptide (IAPP), amylin, is the constituent peptide of pancreatic islet amyloid deposits which form in islets of Type 2 diabetic subjects. Human IAPP is synthesized as a 67-residue propeptide in islet beta-cells and colocalized with insulin in beta-cell granules. The mature 37-amino acid peptide is produced by proteolysis at pairs of basic residues at the C- and N-termini of the mature peptide. To determine the enzymes responsible for proteolysis and their activity at the potential cleavage sites, synthetic human proIAPP was incubated (0.5-16 h) with recombinant prohormone convertases, PC2 or PC3 at appropriate conditions of calcium and pH. The products were analysed by MS and HPLC. Proinsulin was used as a control and was cleaved by both recombinant enzymes resulting in intermediates. PC3 was active initially at the N-terminal-IAPP junction and later at the C-terminus, whereas initial PC2 activity was at the IAPP-C-terminal junction. Processing at the basic residues within the C-terminal flanking peptide rarely occurred. There was no evidence for substantial competition for the processing enzymes when the combined substrates proinsulin and proIAPP were incubated with both PC2 and PC3. As proinsulin cleavage is sequential in vivo (PC3 active at the B-chain-C-peptide junction, followed by PC2 at A chain-C-peptide junction), these data suggest that proteolysis of proIAPP and proinsulin is coincident in secretory granules and increased proinsulin secretion in diabetes could be accompanied by increased production of proIAPP.