A cDNA encoding the human fur gene product was isolated from a human hepatoma cell line. The cDNA encodes a protein with significant amino acid sequence identity to the prokaryotic subtilisin family of serine proteases. More extensive sequence identity was found when the protein was compared with eukaryotic proteases such as PRB1 of Saccharomyces cerevisiae, and with PC2 and PC3, the only other known mammalian subtilisin-like proteases. In contrast to these proteins, however, the fur gene product shares a more extensive topographic and functional homology with the KEX2 endoprotease of S. cerevisiae. Each protease contains a signal peptide, a glycosylated extra cytoplasmic domain, a hydrophobic membrane-spanning region, and a short, hydrophilic "tail" sequence. As with KEX2, the expressed human protease was shown to cleave mammalian proproteins at their paired basic amino acid processing sites. We have, therefore, proposed the function-based acronym PACE (paired basic amino acid cleaving enzyme) for this prototypic mammalian proprotein processing enzyme.