For a long time, prolyl endopeptidase (PEP) was believed to inactivate neuropeptides in the extracellular space. However, reports on the intracellular activity of PEP suggest additional, as yet unidentified, physiological functions for this enzyme. Here, we demonstrate using biochemical methods of subcellular fractionation, immunocytochemical double-labelling procedures and localization of PEP-enhanced green fluorescent protein fusion proteins that PEP is mainly localized to the perinuclear space, and is associated with the microtubulin cytoskeleton in human neuroblastoma and glioma cell lines. Disassembly of the microtubules by nocodazole treatment disrupts both the fibrillar tubulin and PEP labelling. Furthermore, in a two-hybrid screen, PEP was identified as binding partner of tubulin. These findings indicate novel functions for PEP in axonal transport and/or protein secretion. Indeed, a metabolic labelling approach revealed that both PEP inhibition and PEP antisense mRNA expression result in enhanced peptide/protein secretion from human U-343 glioma cells. Because disturbances in intracellular transport and protein secretion mechanisms are associated with a number of ageing-associated neurodegenerative diseases, cell-permeable PEP inhibitors may be useful for the application in a variety of related clinical conditions.