Angiostatin4.5 (AS4.5) is a naturally occurring human angiostatin isoform, consisting of plasminogen kringles 1-4 plus 85% of kringle 5 (amino acids Lys78 to Arg529). Prior studies indicate that plasminogen is converted to AS4.5 in a two-step reaction. First, plasminogen is activated to plasmin. Then plasmin undergoes autoproteolysis within the inner loop of kringle 5, which can be induced by a free sulfhydryl donor or an alkaline pH. We now demonstrate that plasminogen can be converted to AS4.5 in a cell membrane-dependent reaction. Actin was shown previously to be a surface receptor for plasmin(ogen). We now show that beta-actin is present on the extracellular membranes of cancer cells (PC-3, HT1080, and MDA-MB231), and beta-actin can mediate plasmin binding to the cell surface and autoproteolysis to AS4.5. In the presence of beta-actin, no small molecule-free sulfhydryl donor is needed for generation of AS4.5. Antibodies to actin reduced membrane-dependent generation of AS4.5 by 70%. In a cell-free system, addition of actin to in vitro-generated plasmin resulted in stoichiometric conversion to AS4.5. Annexin II and alpha-enolase have been reported to be plasminogen receptors, but we did not demonstrate a role for these proteins in conversion of plasminogen to AS4.5. Our data indicate that membrane-associated beta-actin, documented previously as a plasminogen receptor, is a key cell membrane receptor capable of mediating conversion of plasmin to AS4.5. This conversion may serve an important role in regulating tumor angiogenesis, invasion, and metastasis, and surface beta-actin may also serve as a prognostic marker to predict tumor behavior.