A high peptide alpha-amidating activity is present in a mitochondrial/secretory granules preparation from 3-day old rat pancreas. It is dependent on copper, ascorbate and molecular oxygen. This preparation is able to generate TRH when incubated with Pyroglu-His-Pro-Gly, a sequence present in the TRH precursor molecular. The peptide alpha-amidating activity may be involved in the high rate of TRH biosynthesis in the pancreas during the neonatal period. In the pancreas of adult rats which contain low levels of TRH, the peptide alpha-amidating activity is barely detectable.