GPI8 is a clan CD, family C13 cysteine protease and the catalytic core of the GPI-protein transamidase complex. In Leishmania mexicana, GPI8 is nonessential, and Deltagpi8 mutants lack the GPI-anchored metalloprotease GP63, which is the major surface protein of promastigotes. We have identified the active site histidine and cysteine residues of leishmanial GPI8 and generated Deltagpi8 lines expressing modified GPI8 proteins. This has allowed us to study the processing and trafficking of GP63 in wild type and Deltagpi8 mutants. We show using pulse-chase labeling that in Deltagpi8 non-GPI-anchored GP63 was glycosylated and secreted without further processing from the cell with a t(12) of 120 min. This secretion was prevented by growth of cells in the presence of tunicamycin, indicating that glycosylation is necessary for secretion of non-GPI-anchored proteins. In contrast, in wild type cells the majority of GP63 was rapidly glycosylated, GPI-anchored, and trafficked to the surface with defined processing intermediate forms. Tunicamycin inhibited glycosylation but did not prevent GPI anchor addition or trafficking. These results show that GPI-anchored and unanchored GP63 are trafficked via different pathways. In addition, the balance between GPI anchor addition and secretion of GP63 in Leishmania can vary depending on the activity of the GPI-protein transamidase, which has implications for the host-parasite interaction.