The low abundance fibrillar collagen type V is incorporated into and regulates the diameters of type I collagen fibrils. Bone morphogenetic protein-1 (BMP-1) is a metalloprotease that plays key roles in regulating formation of vertebrate extracellular matrix; it cleaves the C-propeptides of the major fibrillar procollagens I-III and processes precursors to produce the mature forms of the cross-linking enzyme prolysyl oxidase, the proteoglycan biglycan, and the basement membrane protein laminin 5. Here we have successfully produced recombinant pro-alpha1(V)(2)pro-alpha2(V) heterotrimers, and we have used these to characterize biosynthetic processing of the most prevalent in vivo form of type V procollagen. In addition, we have compared the processing of endogenous pro-alpha1(V) chains by wild type mouse embryo fibroblasts and by fibroblasts derived from embryos doubly homozygous null for the Bmp-1 gene and for a gene encoding the closely related metalloprotease mammalian Tolloid-like 1. Together, results presented herein indicate that within pro-alpha1(V)(2)pro-alpha2(V) heterotrimers, pro-alpha1(V) N-propeptides and pro-alpha2(V) C-propeptides are processed by BMP-1-like enzymes, and pro-alpha1(V) C-propeptides are processed by furin-like proprotein convertases in vivo.