METH-1/ADAMTS1 is a member of a newly described family of genes that contain metalloprotease, disintegrin, and thrombospondin-like motifs. We have recently shown that METH-1 protein is a potent inhibitor of angiogenesis. Here, we demonstrate that secreted human pro-METH-1 is processed in two consecutive steps to release both p87 and p65 active forms. The p87 form lacks the N-terminal prodomain and p65 results from an additional processing event in the C-terminal end. Generation of p87 was blocked with specific inhibitors of furin, and incubation of pro-METH-1 with purified furin released the p87 fragment but not p65. Generation of p65 required preformation of p87 and was suppressed by inhibitors of matrix metalloproteases. We demonstrate that matrix metalloproteases 2, 8, and 15 were able to release p65 when p87 was used as substrate. This second processing step removes two thrombospondin repeats from the carboxyl-terminal end of p87-METH-1 and alters the affinity of the protein to heparin and endothelial cultures. Furthermore, this deletion was associated with a reduced activity upon suppression of endothelial cell proliferation. We hypothesize that METH-1 processing is relevant for the modulation of the anti-angiogenic properties displayed by the protein.