Expression of membrane CD276 (mB7-H3) has been reported on dendritic cells (DCs), monocytes, activated T cells, and various carcinoma cells. However, reports concerning its in vivo function have been inconsistent. Moreover, whether there is a soluble form of this protein is not known. In this study, using a sensitive dual monoclonal antibody sandwich enzyme-linked immunosorbent assay (ELISA) to detect the soluble form of B7-H3 (sB7-H3), we demonstrated the release of sB7-H3 by monocytes, DCs, activated T cells, and various mB7-H3+ but not mB7-H3- carcinoma cells. Release from cells was blocked by addition of a matrix metalloproteinase inhibitor (MMPI), which concomitantly caused the accumulation of B7-H3 on the cell surface. To determine the level of circulating sB7-H3, more than 200 serum samples were included in the study. The results indicated that sB7-H3 was present at high levels in all serum samples. Western blotting of sB7-H3 from cell culture supernatants or sera of healthy donors indicated that the molecular size was approximately 16 kDa. Soluble B7-H3 was able to bind to the B7-H3 receptor (B7-H3R) on activated T cells, which showed that sB7-H3 is a functionally active form. These results indicate that release of sB7-H3 from the cell surface is mediated by a matrix metalloproteinase and probably regulates B7-H3R/B7-H3 interactions in vivo. Cleavage of sB7-H3 to an active soluble form would alter both proximal and distal cellular responses.