Amino-terminal degradation has been observed for many of the secreted heterologous proteins produced by S. lividans 66. We, therefore, set out to characterize the relevant proteinases and their genes. A tripeptide chromogenic substrate was used to identify a gene that was shown to encode a secreted protein which removed tripeptides from the amino terminus of extracellular proteins (tripeptidyl aminopeptidase, Tap; Butler et al. 1995). This activity was removed by a homologous gene deletion replacement and the ability of the S. lividans strain to remove N-terminal tripeptides was greatly reduced, but still significant. When the tap-deleted strain was used as a host for the rescreening of a S. lividans 66 genomic DNA library, a number of other genes encoding proteases with aminopeptidase activities were discovered. One clone (P5-4) produced a 45-kDa secreted protein (Ssp), which showed activity against Ala-Pro-Ala-beta-naphthylamide (APA-beta NH-Nap) substrate. Further analysis of the cloned DNA showed an open-reading frame encoding a protein larger than 45 kDa. Direct Edman degradation of the secreted protein confirmed that it was encoded within the cloned DNA and probably processed from a larger precursor. Protein sequence analysis revealed a striking homology to subtilisin BPN’ in three regions around the active-site residues suggesting that the protein is a serine protease. As expected, the protease activity was inhibited by phenylmethylsulphonyl fluoride. Mutant strains with most of the ssp gene deleted exhibited reduced activity against APA-beta NH-Nap substrate compared to their non-deleted parental strains.