Recombinant forms of the dengue 2 virus NS3 protease linked to a 40-residue co-factor, corresponding to part of NS2B, have been expressed in Escherichia coli and shown to be active against para-nitroanilide substrates comprising the P6-P1 residues of four substrate cleavage sequences. The enzyme is inactive alone or after the addition of a putative 13-residue co-factor peptide but is active when fused to the 40-residue co-factor, by either a cleavable or a noncleavable glycine linker. The NS4B/NS5 cleavage site was processed most readily, with optimal processing conditions being pH 9, I = 10 mm, 1 mm CHAPS, 20% glycerol. A longer 10-residue peptide corresponding to the NS2B/NS3 cleavage site (P6-P4') was a poorer substrate than the hexapeptide (P6-P1) para-nitroanilide substrate under these conditions, suggesting that the prime side substrate residues did not contribute significantly to protease binding. We also report the first inhibitors of a co-factor-complexed, catalytically active flavivirus NS3 protease. Aprotinin was the only standard serine protease inhibitor to be active, whereas a number of peptide substrate analogues were found to be competitive inhibitors at micromolar concentrations.