Cell responses to exogenous stimuli often result in a rapid decrease of cell surface density of a wide range of diverse regulatory proteins, receptor and adhesion molecules in particular. This decrease may occur in a ligand-dependent fashion (down-regulation), following endocytosis and degradation by lysosomal proteases, or by down-modulation, where molecules are targeted by endoproteases directly on cell surface. These proteases are recruited by trans-modulating agents, different from ligand, which act via their own receptors and the related intracellularly-generated signals. Endoproteolytic activity determines the release of large portions (shedding) of substrate proteins, called ectodomains, which are usually not ligand-bound, and therefore represent biologically-active molecules. Ectodomain shedding is involved in a number of pathophysiological processes, such as inflammation, cell degeneration and apoptosis, and oncogenesis. Common features of the process, such as the involvement of protein kinase C and of transmembrane metalloproteases, have been identified. In this review, we summarize basic concepts on down-modulation and ectodomain shedding, and provide an update of the issue with respect to: (i) new entries to the list of molecules found involved in the process; (ii) current views about the upstream control of shedding, i.e. the pathways linking the signals triggered by the trans-modulating agents to the activation of endoproteolytic activity on the cell surface.