Dipeptidyl peptidase-IV is a cell surface protease which plays an important role in glucose homeostasis through proteolytic inactivation of incretin hormones, primarily glucagon like peptide-1 (GLP-1). Substrate N-terminal amino acid (S2-S1) specificity is rather clearly defined, while no substantial information is available on the significance of amino acid interactions towards the C-terminus after the scissile bond (so called prime S1'-S4' or distant S5'-S28' sites). In the present study the increasing length of the peptide towards prime sites (S1'-S4') resulted in approximately 7-fold decrease in Km. Moreover, the Km for GLP-1 cleavage was comparable to that of an S2-S4' peptide, suggesting that few, if any, important enzyme-substrate interactions occur beyond the active site. Effect of substrate length on kcat was less obvious, but kcat/Km showed an increasing trend when His-Ala-pNA (representing the natural two N-terminal residues) was compared to GLP-1. To probe the impact of increasing substrate length on the free energy of activation (as has been suggested for elastase and chymotrypsin) we performed temperature studies. To adequately interpret thermodynamic data we sought to understand what steps limit the kcat expression. Steady-state parameters of the reactions catalyzed by serine proteases are composed of microscopic constants describing binding, acylation, and deacylation steps. Viscosity and pre-steady-state studies suggested that His-Ala-pNA cleavage is limited in the deacylation half-reaction, most likely the product release step. Thus, the free energy of activation, as calculated from the Eyring equation, is underestimated (at least for His-Ala-pNA) and the effect of substrate length on the acylation step (and transition-state stabilization) could not be unambiguously assessed.