Transmembrane tryptase (TMT)/tryptase gamma is a membrane-bound serine protease stored in the secretory granules of human and mouse lung mast cells (MCs). We now show that TMT reaches the external face of the plasma membrane when MCs are induced to degranulate. Analysis of purified recombinant TMT revealed that it is a two-chain neutral protease. Thus, TMT is the only MC protease identified so far which retains its 18-residue propeptide when proteolytically activated. The genes that encode TMT and tryptase betaI reside on human chromosome 16p13.3. However, substrate specificity studies revealed that TMT and tryptase betaI are functionally distinct even though they are approximately 50% identical. Although TMT is rapidly inactivated by the human plasma serpin alpha(1)-antitrypsin in vitro, administration of recombinant TMT (but not recombinant tryptase betaI) into the trachea of mice leads to airway hyperresponsiveness (AHR) and increased expression of interleukin (IL) 13. T cells also increase their expression of IL-13 mRNA when exposed to TMT in vitro. TMT is therefore a novel exocytosed surface mediator that can stimulate those cell types that are in close proximity. TMT induces AHR in normal mice but not in transgenic mice that lack signal transducer and activator of transcription (STAT) 6 or the alpha-chain of the cytokine receptor that recognizes both IL-4 and IL-13. Based on these data, we conclude that TMT is an exocytosed MC neutral protease that induces AHR in lungs primarily by activating an IL-13/IL-4Ralpha/STAT6-dependent pathway.