Remodeling of the extracellular matrix (ECM) during development, angiogenesis, wound healing, tumor metastasis, and other morphogenetic processes depends on the exquisitely regulated activities of matrix metalloproteinases (MMPs). Yet very little is known about the activity patterns of these proteases in vivo. We have employed fluorescent MMP-substrates, both in vitro and in vivo, to characterize patterns of MMP activity in the zebrafish embryo. Qualitatively similar patterns of degradation are detected using native Type I or Type IV collagen substrates, suggesting that multiple MMPs are being regulated concomitantly. MMP activity is observed primarily in ECM-rich structures predicted to be undergoing active remodeling, such as the perichordal sheath and somite boundaries. Patterns of Type I and Type IV collagen hydrolysis are similar, but not identical in embryos of any given stage. Conventional gelatin zymography shows MMPs present in embryos as early as 3-somites (11 h) and our in vivo assays detect Type IV collagen degradation at somite boundaries as early as 4-somites (11.5 h). However, we are unable to detect significant in vitro activity using homogenates made from embryos prior to Prim-16 (31 h). Mixed lysate assays demonstrate that this is the result of endogenous inhibitors present in early embryos, suggesting a model of matrix remodeling regulated by spatially heterogeneous MMP inhibition.