SPC3 is a member of a growing family of mammalian subtilisin-like serine proteases which play a probable role in proprotein maturation. In this study we have prepared a mouse L cell line stably expressing rat SPC3 cDNA and characterized the recombinant SPC3 protein secreted into the medium. Three molecular forms of recombinant SPC3 were identified with molecular masses of 86, 75, and 64 kDa. NH2-terminal sequence analysis indicated that all three forms were cleaved following the sequence -Arg107-Arg-Lys-Arg110, indicating removal of an SPC3 prosequence. All three molecular forms showed a 3-4-kDa decrease in molecular mass following incubation with endoglycosidase F. Two SPC3 carboxyl-terminal-directed antisera recognized only the 86-kDa molecular form of recombinant SPC3, demonstrating that COOH-terminal truncation of SPC3 protein is responsible for the different molecular mass forms. Recombinant SPC3 had a pH optimum of 6.0 and was stimulated by calcium, with maximum activity at 10 mM. Recombinant SPC3 was inhibited most effectively by the thiol-reactive reagent p-hydroxymecuribenzoate and the heavy metal chelators EDTA and EGTA. Recombinant SPC3 was also inhibited by alpha 1-antitrypsin Pittsburgh as well as wild type alpha 1-antitrypsin and antithrombin III. The inhibitor specificities revealed using these high molecular mass serpins differ from those reported for other members of the subtilisin-like serine protease family and may be able to be exploited to distinguish between closely related members of this new enzyme superfamily. Studies of cleavage specificity using tri- and tetrapeptidyl coumarins that contained pairs of basic residues indicated that tetrapeptide substrates that contained an S4 Arg residue as part of an -Arg-X-Lys/Arg-Arg motif were the most effective synthetic peptide substrates. Recombinant SPC3 also cleaved human proalbumin following the Arg-Gly-Val-Phe-Arg-Arg prosequence. Circulating human proalbumin variants that contained a mutation at either of the basic amino acids adjacent to the cleavage site were not cleaved by recombinant SPC3. Recombinant SPC3 was also able to cleave after a single arginine residue in chicken proalbumin following the Arg-Asn-Leu-Gln-Arg-Phe-Ala-Arg prosequence. These results define the primary structure requirements for cleavage by recombinant SPC3 and remain consistent with a role for SPC3 in proprotein/prohormone maturation.