The nonstructural protein NS3 of the hepatitis C virus (HCV) harbors a serine protease domain that is responsible for most of the processing events of the nonstructural region of the polyprotein. Its inhibition is presently regarded as a promising strategy for coping with the disease caused by HCV. In this work, we show that the NS3 protease undergoes inhibition by the N-terminal cleavage products of substrate peptides corresponding to the NS4A-NS4B, NS4B-NS5A, and NS5A-NS5B cleavage sites, whereas no inhibition is observed with a cleavage product of the intramolecular NS3-NS4A junction. The Ki values of the hexamer inhibitory products [Ki(NS4A) = 0.6 microM, Ki(NS5A) = 1.4 microM, and Ki(NS4B) = 180 microM] are lower than the Km values of the respective substrate peptides [Km(NS4A-NS4B) = 10 microM, Km(NS5A-NS5B) = 3.8 microM, and Km(NS4B-NS5A) > 1000 microM]. Mutagenesis experiments have identified Lys136 as an important determinant for product binding. The phenomenon of product inhibition can be exploited to optimize peptide inhibitors of NS3 protease activity that may be useful in drug development.