Matrix metalloproteinase 7 (MMP-7) has been purified as an inactive zymogen of M(r) 28,000 (proMMP-7) from the culture medium of CaR-1 human rectal carcinoma cells. The NH2-terminal sequence of proMMP-7 is Lys-Pro-Lys-Pro-Gln-Glu, which is identical to that of matrilysin. The zymogen is activated by 4-aminophenylmercuric acetate (APMA), yielding an intermediate form of M(r) 21,000 and an active species of M(r) 19,000 which shows the new NH2-terminal sequence of Tyr78-Ser-Leu-Phe-Pro-Asn-Ser. Although trypsin fully activates the zymogen, the activation rate by plasmin or leukocyte elastase is confined to approximately 50%. ProMMP-7 can be activated by MMP-3 (stromelysin 1) to its full activity in a single-step mechanism and generates the same NH2 terminus obtained by APMA activation, whereas MMP-1 (tissue collagenase), MMP-2 (gelatinase A), and MMP-9 (gelatinase B) do not have such an effect. On the other hand, proMMP-1 is activated by MMP-7 to an activity similar to that obtained by APMA and the activation by MMP-7 is enhanced up to approximately 6.5 fold in the presence of APMA. This enhanced activity is donated by specific cleavage at the Gln80-Phe81 bond of proMMP-1. MMP-7 can also activate proMMP-9 up to approximately 50% of the full activity with a new NH2 terminus of Leu16-Arg-Thr-(Asn)-Leu. Incubation of proMMP-2 or proMMP-3 with MMP-7 results in no activation of these proMMPs. MMP-7 degrades type IV collagen, laminin-1, fibronectin, proteoglycan, type I gelatin, and insoluble elastin. These results suggest that in vivo MMP-7 may play a role in degradation of extracellular matrix macromolecules in concert with MMP-1, -3, and -9 under pathological conditions.