The liver microsomal vitamin K-dependent carboxylase catalyzes the post-translational conversion of specific glutamyl to gamma-carboxyglutamyl (Gla) residues in precursor forms of a limited number of proteins. These proteins contain an amino-terminal extension (propeptide) that is presumed to serve as an enzyme recognition site to assure their normal processing. The free, noncovalently bound propeptide has also been shown to stimulate the in vitro activity of this enzyme. This peptide has now been shown to lower the app Km of a low-molecular-weight Glu site substrate while having no influence on the app Km of the other substrates, vitamin KH2, O2, and CO2/HCO3-. Propeptide addition was shown to have no influence on the ratio of the two products of the enzyme, Gla and vitamin K-2,3-epoxide. Stimulation of carboxylase activity by the propeptide from human factor X was observed in a number of rat tissues and in the liver of a number of different species. Stability of the enzyme in crude microsomal preparations was greatly enhanced by the presence of propeptide. These observations are consistent with the hypothesis that this region of the protein substrates for the carboxylase not only serves an enzyme recognition or docking function but also modulates the activity of the enzyme by altering the affinity for one of its substrates.