Mitochondria drive apoptosis by releasing pro-apoptotic proteins that promote caspase activation in the cytosol. The rhomboid protease PARL, an intramembrane cleaving peptidase in the inner membrane, regulates mitophagy and plays an ill-defined role in apoptosis. Here, we employed PARL-based proteomics to define its substrate spectrum. Our data identified the mitochondrial pro-apoptotic protein Smac (also known as DIABLO) as a PARL substrate. In apoptotic cells, Smac is released into the cytosol and promotes caspase activity by inhibiting inhibitors of apoptosis (IAPs). Intramembrane cleavage of Smac by PARL generates an amino-terminal IAP-binding motif, which is required for its apoptotic activity. Loss of PARL impairs proteolytic maturation of Smac, which fails to bind XIAP. Smac peptidomimetics, downregulation of XIAP or cytosolic expression of cleaved Smac restores apoptosis in PARL-deficient cells. Our results reveal a pro-apoptotic function of PARL and identify PARL-mediated Smac processing and cytochrome c release facilitated by OPA1-dependent cristae remodelling as two independent pro-apoptotic pathways in mitochondria.