The correlation of the structure of crystalline enzymes with their activities in solution assumes that the catalytic properties are identical in the two physical states. The present data demonstrate that in bovine carboxypeptidase B they differ significantly. Normal Michaelis-Menten kinetics characterize the hydrolysis of several esters and peptide substrates in both physical states. Crystallization reduces kcat 16 to 320-fold, while it affects KM variably and less dramatically. Small molecules inhibit catalytic activity both in solution and in crystals, but the carboxypeptidase inhibitor from potatoes (molecular weight 4200) does no inhibit the crystals. The activities of bovine carboxypeptidases A and B toward identical substrates are more similar in their crystals than in their solutions. This suggests that, over and above the structural dissimilarity of their crystals, conformational differences may additionally determine the activities of the two enzymes in solution. The findings demonstrate that the catalytic properties of carboxypeptidase B depend critically on its physical state.