A major innate defense system in invertebrates is the melanization of pathogens and damaged tissues. This important process is controlled by the enzyme phenoloxidase (PO) that in turn is regulated in a highly elaborate manner for avoiding unnecessary production of highly toxic and reactive compounds. Recent progress, especially in arthropods, in the elucidation of mechanisms controlling the activation of zymogenic proPO into active PO by a cascade of serine proteinases and other factors is reviewed. The proPO-activating system (proPO system) is triggered by the presence of minute amounts of compounds of microbial origins, such as beta-1,3-glucans, lipopolysaccharides, and peptidoglycans, which ensures that the system will become active in the presence of potential pathogens. The presence of specific proteinase inhibitors prevents superfluous activation. Concomitant with proPO activation, many other immune reactions will be produced, such as the generation of factors with anti-microbial, cytotoxic, opsonic, or encapsulation-promoting activities.