The mechanism for the post-translational conversion of glutamine to pyroglutamic acid on the N terminus of newly synthesized peptides and proteins is unknown. An assay is reported that permits measurement of the rate of conversion of Gln-His-Pro-NH2 to pyroGlu-His-Pro-NH2 (TRH). Using this assay, we demonstrate that the spontaneous cyclization of the N-terminal glutamine of this peptide occurs only slowly under physiological conditions. Furthermore, we describe the presence in rat brain, porcine pituitary, and human B lymphocytes of an enzyme(s) which converts Gln-His-Pro-NH2 into pyroGlu-His-Pro-NH2. The enzyme(s) appears to be a glycoprotein, is maximally active at neutral pH, has a Mr of 55,000, and contains catalytically significant sulfhydryl groups. The product of the enzymatic reaction was confirmed by high resolution fast atom bombardment-mass spectrometry. In preliminary studies, we find that over 90% of the enzyme in bovine adrenal medulla is contained in the soluble chromaffin vesicle fraction. These findings indicate that in vivo the post-translational conversion of a glutaminyl-peptide into a pyroglutamyl-peptide is neither spontaneous nor abiotic as has been previously proposed.