The formation of active and catalytic biomolecular condensates is critical to orchestrate intracellular biochemical reactions and cellular functions. Synthetic analogues that mimic such behaviors are typically constructed via liquid-liquid phase separation that generates liquid coacervate-based droplets, which promote reaction efficiency through molecular confinement. Such a type of confined reaction is usually achieved by partitioning and sequestrating active species such as biological enzymes or their mimics (such as metalloenzymes), which can be easily affected by encapsulation efficiency and sensitivity to the local environment. Engineering coacervate-based compartments that can display inherent catalytic functionality remains a significant challenge. Here, we report a bioinspired strategy to construct programmable peptide-based coacervates with inherent enzyme-like catalytic activity via the co-assembly of short peptides. We find that mixing the histidine-tagged short peptides with triphenylalanine-based peptides leads to the formation of a stable coacervate phase, in contrast to the rigid aggregates formed by each individual component. This cooperative assembly enables the generation of functional coacervate compartments with built-in catalytic capability. The resulting peptide coacervates exhibit selective partitioning and sequestration of hydrophobic substrates, thereby enhancing local substrate concentration and promoting catalytic hydrolysis reactions. Our results demonstrate that catalytic activity can be encoded directly into coacervate-forming building blocks through rational peptide design, providing a versatile platform for programming LLPS behavior and constructing biomimetic active materials with potential applications in synthetic biology.