TNF alpha converting enzyme (TACE) processes precursor TNF alpha between Ala76 and Val77, yielding a correctly processed bioactive 17 kDa protein. Genetic evidence indicates that TACE may also be involved in the shedding of other ectodomains. Here we show that native and recombinant forms of TACE efficiently processed a synthetic substrate corresponding to the TNF alpha cleavage site only. For all other substrates, conversion occurred only at high enzyme concentrations and prolonged reaction times. Often, cleavage under those conditions was accompanied by nonspecific reactions. We also compared TNF alpha cleavage by TACE to cleavage by those members of the matrix metalloproteinase (MMP) family previously implied in TNF alpha release. The specificity constants for TNF alpha cleavage by the MMPs were approximately 100-1000-fold slower relative to TACE. MMP 7 also processed precursor TNF alpha at the correct cleavage site but did so with a 30-fold lower specificity constant relative to TACE. In contrast, MMP 1 processed precursor TNF alpha between Ala74 and Gln75, in addition to between Ala76 and Val77, while MMP 9 cleaved this natural substrate solely between Ala74 and Gln75. Additionally, the MMP substrate Dnp-PChaGC(Me)HK(NMA)-NH(2) was not cleaved at all by TACE, while collagenase (MMP 1), gelatinase (MMP 9), stromelysin 1 (MMP 3), and matrilysin (MMP 7) all processed this substrate efficiently. All of these results indicate that TACE is unique in terms of its specificity requirements for substrate cleavage.