Mice with a targeted mutation in proSAAS have been generated to investigate whether peptides derived from this precursor could function as an inhibitor of prohormone convertase 1/3 (PC1/3) in vivo as well as to determine any alternate roles for proSAAS in nervous and endocrine tissues. Fetal mice lacking proSAAS exhibit complete, adult-like processing of prodynorphin in the prenatal brain instead of the incomplete processing seen in the brains of wild-type fetal mice where inhibitory proSAAS intermediates are transiently accumulated. This study provides evidence that proSAAS is directly involved in the prenatal regulation of neuropeptide processing in vivo. However, adult mice lacking proSAAS have normal levels of all peptides detected using a peptidomics approach, suggesting that PC1/3 activity is not affected by the absence of proSAAS in adult mice. ProSAAS knockout mice exhibit decreased locomotion and a male-specific 10-15% decrease in body weight, but maintain normal fasting blood glucose levels and are able to efficiently clear glucose from the blood in response to a glucose challenge. This work suggests that proSAAS-derived peptides can inhibit PC1/3 in embryonic brain, but in the adult brain proSAAS peptides may function as neuropeptides that regulate body weight and potentially other behaviors.