Cysteine lysosomal proteases are essential for turnover of intracellular and extracellular proteins. These enzymes are strongly implicated in normal and pathological processes involving tissue remodeling. Among the cysteine proteases, cathepsin S seems to be best suited for such a process since it retains most of its enzymatic activity at neutral pH. In situ hybridization analyses of the adult rat brain, spleen, and lung reveal that cathepsin S mRNA is preferentially expressed in cells of mononuclear-phagocytic origin. After entorhinal cortex lesion of adult rat brain (a paradigm for neuronal degeneration and reactive synaptogenesis), cathepsin S mRNA is dramatically increased in activated microglia in the deafferented dentate gyrus and in macrophages at the wound site, suggesting a role in lesion-induced tissue remodeling. This possibility is further supported by the finding that cathepsin S degrades a number of extracellular matrix molecules at neutral pH and by the finding that inflammatory mediators stimulate its secretion from the microglia and macrophages. These data suggest that cathepsin S is an important player in degenerative disorders associated with the cells of the mononuclear phagocytic system.