Human neuroblastoma GOTO cell lines were established that stably express recombinant human lysosomal protective protein/cathepsin A (PPCA) cDNA by transfection. Intracellular cathepsin A (acid serine carboxypeptidase) activity increased four-fold compared with in those of the parent and mock-transfected cell lines. The immunoreactive 54 kDa precursor/zymogen and mature 32/20 kDa two-chain forms were produced in the cells. The amount of the latter form expressed in the GOTO cells was significantly larger than those in the PPCA-overexpressing CHO cell lines previously established. The intracellular proteins showed a typical lysosomal granular distribution and the glycosylated 54 kDa precursor was secreted into the culture medium without the addition of an alkalizing agent. The PPCA-overexpressing cell lines also retained the ability to differentiate bi-directionally as well as the parent cells; into neuronal cells on induction by dibutyryl cAMP in serum-free medium and into Schwannian cells on induction by bromodeoxyuridine. During the course of differentiation into neuronal and Schwannian cells, the intracellular cathepsin A activity further increased two and five times, respectively, which was associated with an increase in the expression of the 32/20 kDa two-chain form. The glycosylated precursor proteins were taken up via the mannose 6-phosphate receptors, and the cathepsin A, alpha-neuraminidase and beta-galactosidase (beta-Gal) activities deficient in the fibroblasts derived from a patient with PPCA deficiency (galactosialidosis) were restored. These results suggest that the bi-directional differentiation of GOTO cell lines stably expressing the recombinant human PPCA gene could be a model system for analyzing the functions of PPCA in peripheral neuronal cells and Schwannian cells as well as the recombinant PPCA could be a useful source for enzyme replacement therapy (ERT) for galactosialidosis patients.