Matrix metalloproteinases (MMPs) were first described as proteases that act on protein components of the extracellular matrix. However, subsequent studies of MMP function in vivo have revealed that these proteinases also cleave numerous non-ECM protein substrates. Because their substrates are diverse in functions, MMPs are involved in variety of homeostatic functions, such as tissue repair and immunity, as well as pathological processes, including cancer, fibroses and inflammation. Essential steps in regulating MMP proteolysis are conversion of the zymogen into an active proteinase and subsequent inactivation. A number of mechanisms including proteolysis, allosteric interactions, oxidative modification, pericellular compartmentalization, interaction with tissue inhibitor of metalloproteinases (TIMPs), endocytosis, and more have been proposed to control the activation and inactivation of MMPs. In this paper, we discuss these and other mechanisms, and their relevance to in vivo control of MMP-mediated functions.