The tumor necrosis factor alpha converting enzyme (TACE) activity is required for the shedding of a variety of biologically active membrane bound precursors. The activation of TACE necessitates the proteolytic cleavage of its prodomain, a process that was suggested to be catalyzed by the proprotein convertase furin. However, the involvement of furin in this activation process has never been experimentally demonstrated. We have shown that the furinlike cleavage site (R-V-K-R(214)) localized between the prodomain and the metalloprotease domain of TACE is the sole site that can be in vitro cleaved by furin. In Cos7 cells, the release of TACE-processed substrates was reduced by the overexpression of the furin-specific proprotein convertase inhibitor Portland alpha1-antitrypsin inhibitor, but the release of TACE-processed substrates was increased by overexpression of furin in LoVo cells (deficient in furin activity) in which a mature form of TACE was identified. The immature form of TACE was detected at the surface of LoVo cells and at the surface of Cos7 and HT29 cells upon proprotein convertase inhibition. These results suggest that furin is the major proprotein convertase involved in the maturation/activation of TACE which is not a prerequisite for its cell-surface expression.