The reagent pentafluorophenyl S-acetylmercaptoacetate was used to modify the N-terminus of resin-bound side-chain-protected peptides. The modification was carried out in an automated cycle in the final stage of fluorenylmethoxycarbonyl (Fmoc)/polyamide-mediated solid-phase synthesis. Side-chain deprotection and cleavage from the resin with aqueous trifluoroacetic acid gave the N-(S-acetylmercaptoacetyl) peptides. The S-acetylmercaptoacetyl peptides were transformed into reactive thiol-containing peptides by incubation with hydroxylamine at neutral pH. The S-deacetylation was performed in the presence of a sulfhydryl-reactive compound (or intramolecular group) to enable immediate capture of the sensitive thiol. Three applications were investigated. An S-acetylmercaptoacetyl peptide, containing a sequence of a meningococcal membrane protein, was incubated with hydroxylamine in the presence of 5-(iodoacetamido)fluorescein to give the corresponding fluorescein-labeled peptide in 62% yield. The same peptide was also S-deacetylated in the presence of bromoacetylated poly-L-lysine to afford a peptide/polylysine conjugate. Finally, a peptide corresponding to a sequence of herpes simplex virus glycoprotein D was prepared. This peptide, containing an N-terminal-S-acetylmercaptoacetyl group and an additional C-terminal S-(3-nitro-2-pyridinesulfenyl)cysteine residue, was converted into a cyclic disulfide peptide (20%).