During infection of host cells, a number of enveloped animal viruses are known to produce soluble forms of viral membrane glycoproteins lacking the transmembrane domain. The roles of such soluble glycoproteins in viral life cycles are incompletely understood, but in several cases they are believed to modulate host immune response and viral pathogenesis. Semliki Forest virus (SFV) is an enveloped alphavirus that infects cells through low-pH-dependent fusion and buds from the plasma membrane. Fusion is mediated by the E1 subunit of the SFV spike protein. Previous studies described the in vivo generation of E1s, a truncated soluble form of E1, under conditions in which budding is inhibited in mammalian host cells. We have here examined the properties of E1s generation and the biological activity of E1s. E1s cleavage required spike protein transport out of the endoplasmic reticulum and was independent of virus infection. Cell surface E1 efficiently acted as a precursor for E1s. E1s generation was strongly pH dependent in BHK cells, with optimal cleavage at a pH of < or =7.0, conditions that inhibited the budding of SFV but not the budding of the rhabdovirus vesicular stomatitis virus. The pH dependence of E1s production and SFV budding was unaffected by the stability of the spike protein dimer but was a function of the host cell. Similar to the intact virus and in vitro-generated E1 ectodomain, treatment of E1s at low pH in the presence of target membranes triggered specific acid-dependent conformational changes. Thus, under a variety of conditions, SFV-infected cells can produce a soluble form of E1 that is biologically active.