The proteolytic activities of matrix metalloproteinases and plasminogen activators as well as their inhibitors are important in maintaining the integrity of the extracellular matrix (ECM). Cell-ECM interactions influence cell proliferation, differentiation, adhesion and migration. In the nervous system, proteolysis of the ECM is involved in neuronal cell migration in the developing cerebellum and in neurite outgrowth. Likewise, in pathological conditions such as brain tumour growth and invasion, leukocyte infiltration into brain tumours, leukocyte trafficking in the central nervous system in inflammatory diseases such as multiple sclerosis and viral encephalitis, and in nerve demyelination, matrix-degrading proteinases and their inhibitors have been implicated. An understanding of cell-ECM interactions and ECM degradation in diseases of the nervous system would provide new insight for drug design and other forms of therapy.