Degradative fragments of cartilage oligomeric matrix protein (COMP) have been observed in arthritic patients. The physiological enzyme(s) that degrade COMP, however, remain unknown. We performed a yeast two-hybrid screen (Y2H) to search for proteins that associate with COMP to identify an interaction partner that might degrade it. One screen using the epidermal growth factor (EGF) domain of COMP as bait led to the discovery of ADAMTS-7. Rat ADAMTS-7 is composed of 1595 amino acids, and this protein exhibits higher expression in the musculoskeletal tissues. COMP binds directly to ADAMTS-7 in vitro and in native articular cartilage. ADAMTS-7 selectively interacts with the EGF repeat domain but not with the other three functional domains of COMP, whereas the four C-terminal TSP motifs of ADAMTS-7 are required and sufficient for association with COMP. The recombinant catalytic domain and intact ADAMTS-7 are capable of digesting COMP in vitro. The enzymatic activity of ADAMTS-7 requires the presence of Zn2+ and appropriate pH (7.5-9.5), and the concentration of ADAMTS-7 in cartilage and synovium of patients with rheumatoid arthritis is significantly increased as compared to normal cartilage and synovium. ADAMTS-7 is the first metalloproteinase found to bind directly to and degrade COMP.