Dipeptidyl carboxypeptidase from Escherichia coli (EcDcp) is a zinc metallopeptidase with catalytic properties closely resembling those of angiotensin I-converting enzyme (ACE). However, EcDcp and ACE are classified in different enzyme families (M3 and M2, respectively) due to differences in their primary sequences. We cloned and expressed EcDcp and studied in detail the enzyme's S(3) to S(1)' substrate specificity using positional-scanning synthetic combinatorial (PS-SC) libraries of fluorescence resonance energy transfer (FRET) peptides. These peptides contain ortho-aminobenzoic acid (Abz) and 2,4-dinitrophenyl (Dnp) as donor/acceptor pair. In addition, using FRET substrates developed for ACE [Abz-FRK(Dnp)P-OH, Abz-SDK(Dnp)P-OH and Abz-LFK(Dnp)-OH] as well as natural ACE substrates (angiotensin I, bradykinin, and Ac-SDKP-OH), we show that EcDcp has catalytic properties very similar to human testis ACE. EcDcp inhibition studies were performed with the ACE inhibitors captopril (K(i)=3 nM) and lisinopril (K(i)=4.4 microM) and with two C-domain-selective ACE inhibitors, 5-S-5-benzamido-4-oxo-6-phenylhexanoyl-L-tryptophan (kAW; K(i)=22.0 microM) and lisinopril-Trp (K(i)=0.8 nM). Molecular modeling was used to provide the basis for the differences found in the inhibitors potency. The phylogenetic relationship of EcDcp and related enzymes belonging to the M3 and M2 families was also investigated and the results corroborate the distinct origins of EcDcp and ACE.