The biosynthesis of insulin and betagranin, a 20-21 kDa co-secreted chromogranin A-related protein, were investigated in isolated insulinoma cells and islets. The insulinoma tissue processed proinsulin to insulin with kinetics similar to those reported in islet tissue. Unlike islets, however, the insulinoma released almost one-quarter of the newly synthesized proinsulin into the medium 10-40 min after its formation. Betagranin was initially immunoprecipitated as a 100 kDa precursor form, which was indistinguishable from chromogranin A in size and immunoreactivity and by peptide mapping. After an initial lag of 10-20 min, the precursor was converted progressively into betagranin, which appeared to be a stable end product. Formation of betagranin and insulin from their respective precursors followed a parallel course and could likewise be inhibited by NH4+, chloroquine and monensin, added either before labelling or at any point of time up to 15 min after labelling. As with proinsulin, approximately one-quarter of the betagranin precursor was released 10-40 min after synthesis. It is concluded that betagranin is produced by limited proteolysis from a chromogranin A precursor in pancreatic beta-cells by a cellular pathway indistinguishable from that of insulin from proinsulin. Chromogranin A is highly conserved in the N-terminal region represented by betagranin, further suggesting that the biological activity of chromogranin A may reside in a derived peptide rather than in the parent molecule.