Atypical protein kinase C zeta (PKCzeta) is known to transduce signals that influence cell proliferation and survival. Here we show that recombinant human caspases can process PKCzeta at three sites in the hinge region between the regulatory and catalytic domains. Caspase-3, -6, -7, and -8 chiefly cleaved human PKCzeta at EETD downward arrowG, and caspase-3 and -7 also cleaved PKCzeta at DGMD downward arrowG and DSED downward arrowL, respectively. Processing of PKCzeta expressed in transfected cells occurred chiefly at EETD downward arrowG and DGMD downward arrowG and produced carboxyl-terminal polypeptides that contained the catalytic domain. Epitope-tagged PKCzeta that lacked the regulatory domain was catalytically active following expression in HeLa cells. Induction of apoptosis in HeLa cells by tumor necrosis factor alpha plus cycloheximide evoked the conversion of full-length epitope-tagged PKCzeta to two catalytic domain polypeptides and increased PKCzeta activity. A caspase inhibitor, zVAD-fmk, prevented epitope-tagged PKCzeta processing and activation following the induction of apoptosis. Induction of apoptosis in rat parotid C5 cells produced catalytic domain polypeptides of endogenous PKCzeta and increased PKCzeta activity. Caspase inhibitors prevented the increase in PKCzeta activity and production of the catalytic domain polypeptides. Treatment with lactacystin, a selective inhibitor of the proteasome, caused polyubiquitin-PKCzeta conjugates to accumulate in cells transfected with the catalytic domain or full-length PKCzeta, or with a PKCzeta mutant that was resistant to caspase processing. We conclude that caspases process PKCzeta to carboxyl-terminal fragments that are catalytically active and that are degraded by the ubiquitin-proteasome pathway.