The procollagen COOH-terminal proteinase enhancer (PCPE) is a glycoprotein that binds the COOH-terminal propeptide of type I procollagen and potentiates its cleavage by procollagen C-proteinases, such as bone morphogenetic protein-1 (BMP-1). Recently, sequencing of a human expressed sequence tag, which maps near the primary open angle glaucoma region on chromosome 3q21, showed it to encode a novel protein with only 43% identity with PCPE but with a similar domain structure. Here we show this novel protein to be a functional procollagen COOH-terminal proteinase enhancer with activity comparable with that of PCPE and thus propose the designations PCPE2 and PCPE1, respectively. PCPE2 is shown to have a much more limited distribution of expression than does PCPE1, with strong expression primarily in nonossified cartilage in developing tissues and at high levels in the adult heart. PCPE2 is shown to be a glycoprotein that differs markedly in the nature of its glycosylation from that of PCPE1. PCPE2 is also shown to have markedly stronger affinity for heparin than PCPE1, which may account for higher affinities for cell layers. Unexpectedly, both PCPE1 and PCPE2 were found to be collagen-binding proteins, capable of binding at multiple sites on the triple helical portions of fibrillar collagens and also capable of competing for such binding with procollagen C-proteinases. The latter observations may provide insights into the ways PCPEs affect the kinetics of the C-proteinase reaction and into the physical interactions that occur between procollagen C-proteinases and their substrates.