Increased expression of proteases has been correlated with the malignant progression of a variety of tumors. We found a significant increase in cathepsin H expression in high-grade prostatic intraepithelial neoplasia and carcinoma of the prostate. Two forms of cathepsin H, the full-length form (CTSH) and a truncated form with a 12-amino acid deletion in its signal peptide region (CTSHDelta10-21), were identified by cDNA sequence analysis. This deletion occurred not at the genomic level but likely at the RNA processing level. Both forms are expressed in prostate tissues as well as LNCaP, PC-3, and DU-145 prostate cancer cell lines. The deletion within the signal peptide region affected the trafficking of cathepsin H. Fluorescence microscopy, subcellular fractionation, and activity data indicated that the truncated form was perinuclear and secreted and had a reduced lysosomal association as compared with the full-length cathepsin H. Furthermore, the truncated cathepsin H was enzymatically active. Therefore, an increase in overall cathepsin H expression, particularly in the truncated form with a high secretion propensity, may affect cell biological behaviors such as those associated with tumor progression.