Tripeptidyl peptidase-I (TPP-I) is a lysosomal exopeptidase which removes tripeptides from the N-terminus of small peptides. Mutations in the TPP-I gene result in a lethal neurodegenerative disease, classical late-infantile neuronal ceroid lipofuscinosis (CLN2). This disease is characterized by the accumulation of proteinaceous and autofluorescent material within the lysosomes of neurons, which undergo massive cell death during the course of the disease. The absence of TPP-I may result in the lysosomal accumulation of small peptides and proteins, which eventually compromises lysosomal functions critical to the survival of neurons. To investigate the metabolism of small peptides, we have studied the degradation of cholecystokinin-(29-33)-amide (GWMDF-NH2; cholecystokinin C-terminal pentapeptide) by lysosomal fractions isolated from mouse brain and several other tissues. GWMDF-NH2 is cleaved at only one peptide bond by brain lysosomes, to produce GWM and DF-NH2. Inhibitor studies demonstrate that this reaction is catalysed by TPP-I. In contrast, lysosomal fractions from other mouse tissues additionally cleave a second peptide bond to produce GW and MDF-NH2. Inhibitor studies indicate that this reaction is catalysed by dipeptidyl peptidase-I (DPP-I; cathepsin C). Inhibitors of TPP-I are sufficient to completely block the degradation of GWMDF-NH2 by brain, but inhibitors of both TPP-I and DPP-I are required to completely inhibit the degradation of GWMDF-NH2 by other mouse tissues. Enzyme assays confirm the low activity of DPP-I in brain. An unrelated neuropeptide, neuromedin B, is degraded by a pathway that is partially dependent on TPP-I. These results indicate that TPP-I is required for the partial or complete digestion of certain neuropeptides by brain lysosomes. In the absence of TPP-I, neuropeptides or their degradation products will accumulate in brain lysosomes and may contribute to the pathogenesis of CLN2. Other tissues are spared because they express another peptidase, DPP-I, which has extensive activity on peptides and can compensate for the loss of TPP-I.