Human pappalysin-1 is a multi-domain metalloprotease engaged in the homeostasis of insulin-like growth factors and the founding member of the pappalysin family within the metzincin clan of metalloproteases. We have recently identified an archaeal relative, ulilysin, encompassing only the protease domain. It is a 262-residue active protease with a novel 3D structure with two subdomains separated by an active-site cleft. Despite negligible overall sequence similarity, noticeable similarity is found with other metzincin prototypes, adamalysins/ADAMs and matrix metalloproteinases. Ulilysin has been crystallised in a product complex with an arginine-valine dipeptide occupying the active-site S(1') and S(2') positions and in a complex with the broad-spectrum hydroxamic acid-based metalloprotease inhibitor, batimastat. This molecule inhibits mature ulilysin with an IC(50) value of 61 microM under the conditions assayed. The binding of batimastat to ulilysin evokes binding to vertebrate matrix metalloproteases but is much weaker. These data give insight into substrate specificity and mechanism of action and inhibition of the novel pappalysin family.