Murine pregnancy-associated plasma protein-A (PAPP-A) cDNA encoding a 1545 amino-acid protein has been cloned. We have also identified and cloned cDNA that encodes a novel variant of PAPP-A, PAPP-Ai, carrying a 29-residue highly basic insert. The point of insertion corresponds to a junction between two exons in the human PAPP-A gene. The human intron flanked by these exons does not encode a homologous corresponding insert, which is unique to the mouse. The overall sequence identity between murine and human PAPP-A is 91%, and murine PAPP-A contains sequence motifs previously described in the sequence of human PAPP-A. Through expression in mammalian cells, we show that murine PAPP-A and PAPP-Ai are active metalloproteinases, both capable of cleaving insulin-like growth factor binding protein (IGFBP)-4 and -5. Cleavage of IGFBP-4 is dramatically enhanced by the addition of IGF, whereas cleavage of IGFBP-5 is slightly inhibited by IGF, as previously established with human PAPP-A. Surprisingly, however, quantitative analyses demonstrate that the murine PAPP-Ai cleaves IGFBP-4 very slowly compared to PAPP-A, even though its ability to cleave IGFBP-5 is unaffected by the presence of the insert. By RT-PCR analysis, we find that both variants are expressed in several tissues. The level of mRNA in the murine placenta does not exceed the levels of other tissues analyzed. Furthermore, the IGFBP-4-proteolytic activity of murine pregnancy serum is not elevated. This is in striking contrast to the increase seen in human pregnancy serum, and the expression of PAPP-A in the human placenta, which exceeds other tissues at least 250-fold. Interestingly, the position of the insert of PAPP-Ai, within the proteolytic domain, lies in close proximity to the cysteine residue, which in human PAPP-A forms a disulfide bond with the proform of eosinophil major basic protein (proMBP). ProMBP functions as a proteinase inhibitor in the PAPP-A-proMBP complex, but whether any mechanistic parallel on regulation of proteolytic activity can be drawn between the insert of PAPP-Ai and the linkage to proMBP is not known. Importantly, these data support the development of the mouse as a model organism for the study of PAPP-A, which must take into account the differences between the mouse and the human.