Epidermal growth factor (EGF) is a 53-amino-acid mitogenic polypeptide present in a variety of tissues and fluids including kidney, urine, and amniotic fluid, An EGF isoform, des-Arg(53)-EGF, has been identified in urine and is the earliest metabolite generated in target cells upon EGF binding, In this study, purified carboxypeptidase M efficiently released the COOH-terminal arginine residue from EGF with a K-m = 56 mu M, k(cat) = 388 min(-1), and k(cat)/K-m = 6.9 mu M(-1) min(-1), When EGF was incubated with urine or amniotic fluid, des-Arg(53)-EGF was the only metabolite detected, This conversion was blocked by immunoprecipitation with specific antiserum to carboxypeptidase M or by 10 mu M DL-2-mercaptomethyl-3-guanidinoethylthiopropanoic acid (a carboxypeptidase M inhibitor), indicating that the major EGF metabolizing enzyme in these fluids is carboxypeptidase M. When incubated on a confluent monolayer of Madin-Darby canine kidney (MDCK) cells, EGF was readily converted to a single metabolite, des-Arg(53)-EGF, by carboxypeptidase M, To investigate one possible functional consequence of this conversion, mitogenic activities of EGF and des-Arg(53)-EGF were tested, Both peptides were equipotent in stimulating [H-3]thymidine incorporation in MDCK cells at all doses tested, In addition, inhibition of the conversion of EGF to des-Arg(53)-EGF by the carboxypeptidase M inhibitor did not affect the mitogenic potency of EGF. These data indicate that carboxypeptidase M, present in a variety of cells and biological fluids, can convert EGF to des-Arg(53)-EGF, However, in contrast to many other peptide hormones whose activity depends on a final carboxypeptidase processing step, removal of Arg(53) of EGF is not required for its mitogenic activity.