A proteinase with high affinity for insulin has been proposed to play a role in the cellular processing of this hormone. A complementary DNA (cDNA) coding for this enzyme has been isolated and sequenced. The deduced amino acid sequence of the enzyme contained the sequences of 13 peptides derived from the isolated protein. The cDNA could be transcribed in vitro to yield a synthetic RNA that in cell-free translations produced a protein that coelectrophoresed with the native proteinase and could be immunoprecipitated with monoclonal antibodies to this enzyme. The deduced sequence of this proteinase did not contain the consensus sequences for any of the known classes of proteinases (that is, metallo, cysteine, aspartic, or serine), but it did show homology to an Escherichia coli proteinase (called protease III), which also cleaves insulin and is present in the periplasmic space. Thus, these two proteins may be members of a family of proteases that are involved in intercellular peptide signaling.