Pancreatic carboxypeptidase A1 (CPA1) is synthesized as an inactive precursor, proCPA1, which is processed to the active enzyme by the proteolytic removal of the 95-amino acid N-terminal prodomain. Purified rat proCPA1 is renatured in vitro after denaturation in guanidine or in guanidine plus reducing agents. In contrast, purified CPA1 is not renatured under any of the conditions tested. While proCPA1 is secreted in yeast when fused to the alpha-factor signal sequence in place of its endogenous signal sequence, mature CPA1 is not secreted and is trapped and degraded intracellularly. Thus, in addition to maintaining CPA1 in the inactive state, the prodomain promotes folding and secretion of the proenzyme. Neither of these functions can be restored by supplying the prodomain to CPA1 in trans. The three-dimensional structure of porcine proCPA reveals a number of extensive contacts made between the prodomain and the enzyme active site which account for its inhibitory properties [Guasch et al. (1992) J. Mol. Biol. 224, 141-157]. Among these contacts are salt bridges formed between Arg-71 and Asp-A36 and between Arg-124 and Asp-A89. Mutation of any of these four residues inhibits secretion of proCPA1 from yeast and results in its intracellular degradation. The effect of the mutations on secretion suggests that interactions which stabilize the binding of prodomain to the native enzyme active site may also be important for the successful folding of proCPA1.