The cDNA sequence of human collagen XVII predicts an unusual type II transmembrane protein, but a biochemical characterization of this structure has not been accomplished yet. Using domain-specific antibodies against recombinant collagen XVII fragments, we identified two molecular forms of the collagen in human skin and epithelial cells. Full-length collagen XVII appeared as a homotrimeric transmembrane molecule of three 180-kDa alpha1(XVII) chains. The globular intracellular domain was disulfide-linked, and the N-glycosylated extracellular domain of three 120-kDa polypeptides was triple-helical at physiological temperatures. A second, soluble form of collagen XVII in keratinocyte culture media was recognized with antibodies to the ectodomain, but not the endodomain. The soluble form exhibited molecular properties of the collagen XVII ectodomain: a triple-helical, N-glycosylated molecule of three 120-kDa polypeptides. Northern blot analysis with probes spanning either the distal 5'or the distal 3' end of the collagen XVII cDNA revealed an identical 6-kb mRNA, suggesting that both the 180- and 120-kDa polypeptides were translated from the same mRNA, and that the 120-kDa polypeptide was generated post-translationally. In concert, keratinocytes harboring a homozygous nonsense mutation in the COL17A1 gene synthesized neither the 180-kDa alpha1(XVII) chain nor the 120-kDa polypeptide. Finally, treatment of normal keratinocytes with a synthetic inhibitor of furin proprotein convertases, decanoyl-RVKR-chloromethyl ketone, prevented the generation of the 120-kDa polypeptide. These data strongly suggest that the soluble 120-kDa polypeptide represents a specifically cleaved ectodomain of collagen XVII, generated through furin-mediated proteolytic processing. Thus, collagen XVII is not only an unusual type II transmembrane collagen, but the first collagen with a specifically processed, soluble triple-helical ectodomain.