Protease nexin-2 (PN-2) is a protease inhibitor that is synthesized and secreted by a variety of extravascular cells including human fibroblasts. It forms sodium dodecyl sulfate-stable complexes with trypsin, the epidermal growth factor binding protein and the gamma-subunit of nerve growth factor. Recently we reported that PN-2 is the secreted form of the amyloid beta-protein precursor (APP) and is a potent inhibitor of chymotrypsin. Here we describe a two-step procedure to purify PN-2/APP using a monoclonal antibody immunoaffinity column. We also quantitated the protease inhibitory properties of purified PN-2/APP on a number of serine proteases. PN-2/APP was a potent inhibitor of coagulation factor XIa with a Ki = 2.9 x 10(-10). The inhibition of factor XIa by PN-2/APP was augmented by heparin and resulted in a Ki = 5.5 x 10(-11) M. Trypsin and chymotrypsin were also effectively inhibited with a Ki = 4.2 x 10(-10) and 1.6 x 10(-9), respectively. PN-2/APP also inhibited the epidermal growth factor binding protein, the gamma-subunit of nerve growth factor, and chymase and plasmin to a lesser extent. In view of recent findings that PN-2/APP is contained in alpha-granules of platelets and is secreted upon platelet activation, the potent inhibition of factor XIa suggests that PN-2/APP may play a regulatory role in the coagulation pathway at vascular wound sites. In addition, these studies define biochemical activities of PN-2/APP which may be involved in regulating proteases that lead to the generation and deposition of the beta-protein in neurodegenerative lesions associated with Alzheimer's disease and Down's syndrome.