Gamma-glutamyltranspeptidase (gammaGT), a member of the N-terminal nucleophile hydrolase superfamily, initiates extracellular glutathione reclamation by cleaving the gamma-glutamyl amide bond of the tripeptide. This protein is translated as an inactive proenzyme that undergoes autoprocessing to become an active enzyme. The resultant N terminus of the cleaved proenzyme serves as a nucleophile in amide bond hydrolysis. Helicobacter pylori gamma-glutamyltranspeptidase (HpGT) was selected as a model system to study the mechanistic details of autoprocessing and amide bond hydrolysis. In contrast to previously reported gammaGT, large quantities of HpGT were expressed solubly in the inactive precursor form. The 60-kDa proenzyme was kinetically competent to form the mature 40- and 20-kDa subunits and exhibited maximal autoprocessing activity at neutral pH. The activated enzyme hydrolyzed the gamma-glutamyl amide bond of several substrates with comparable rates, but exhibited limited transpeptidase activity relative to mammalian gammaGT. As with autoprocessing, maximal enzymatic activity was observed at neutral pH, with hydrolysis of the acyl-enzyme intermediate as the rate-limiting step. Coexpression of the 20- and 40-kDa subunits of HpGT uncoupled autoprocessing from enzymatic activity and resulted in a fully active heterotetramer with kinetic constants similar to those of the wild-type enzyme. The specific contributions of a conserved threonine residue (Thr380) to autoprocessing and hydrolase activities were examined by mutagenesis using both the standard and coexpression systems. The results of these studies indicate that the gamma-methyl group of Thr380 orients the hydroxyl group of this conserved residue, which is required for both the processing and hydrolase reactions.