The cleavage of parathyroid hormone (PTH) from its precursor proparathyroid hormone (pro-PTH) is accomplished efficiently by the proprotein convertase furin (Hendy, G. N., Bennett, H. P. J., Gibbs, B. F., Lazure, C., Day, R., and Seidah, N. G. (1995) J. Biol. Chem. 270, 9517-9525). We also showed that a synthetic peptide comprising the -6 to +7 sequence of human pro-PTH is appropriately cleaved by purified furin in vitro. The human pro-PTH processing site Lys-Ser-Val-Lys-Lys-Arg differs from the consensus furin site Arg-Xaa-(Lys/Arg)-Arg that is represented by Arg-Arg-Leu-Lys-Arg in the cleavage site of pro-PTH-related peptide (pro-PTHrP). An earlier study demonstrated that an internally quenched fluorogenic substrate bearing an O-aminobenzoyl fluorescent donor at the NH2 terminus and an acceptor 3-nitrotyrosine near the COOH terminus was appropriately cleaved by the convertases furin and PC1 (Jean, F., Basak, A., DiMaio, J., Seidah, N. G., and Lazure, C. (1995) Biochem. J. 307, 689-695). Here, we have synthesized a series of internally quenched fluorogenic substrates based upon the pro-PTH and pro-PTHrP sequences to determine which residues are important for furin cleavage. Purified recombinant furin and PC1 cleaved the human pro-PTH internally quenched substrate at the appropriate site in an identical manner to that observed with the nonfluorescent peptide. Several substitutions in the P6-P3 sequence were well tolerated; however, replacement of the Lys at the P6 position with Gly and replacement of the P3 Lys by an acidic residue led to markedly compromised cleavage by furin. Furin activity was very sensitive to substitution in P' positions. Replacement of Ser at P1' with Gly and Val at P2' with Ala generated substrates that were less well cleaved. Substitution at the P1' position of Val for Ser in conjunction with Ala for Val at P2', as well as a single substitution of Lys for Val at P2', generated specific inhibitors of furin cleavage. The findings of this study open the way to the rational design of inhibitors of furin with therapeutic potential.