Serum vitamin D3-binding protein (Gc protein) is the precursor for the principal macrophage activating factor (MAF). The precursor activity of serum Gc protein was reduced in all influenza virus-infected patients. These patient sera contained alpha-N-acetylgalactosaminidase (Nagalase) that deglycosylates Gc protein. Deglycosylated Gc protein cannot be converted to MAF, thus it loses the MAF precursor activity, leading to immunosuppression. An influenza virus stock contained a large amount of Nagalase activity. A sucrose gradient centrifugation analysis of the virus stock showed that the profile of Nagalase activity corresponds to that of hemagglutinating activity. When these gradient fractions were treated with 0.01% trypsin for 30 min, the Nagalase activity of each fraction increased significantly, suggesting that the Nagalase activity resides on an outer envelope protein of the influenza virion and is enhanced by the proteolytic process. After disruption of influenza virions with sodium deoxycholate, fractionation of the envelope proteins with mannose-specific lectin affinity column along with electrophoretic analysis of the Nagalase peak fraction revealed that Nagalase is the intrinsic component of the hemagglutinin (HA). Cloned HA protein exhibited Nagalase activity only if treated with trypsin. Since both fusion capacity and Nagalase activity of HA protein are expressed by proteolytic cleavage, Nagalase activity appears to be an enzymatic basis for the fusion process. Thus, Nagalase plays dual roles in regulating both infectivity and immunosuppression.