alpha-Amino acids can undergo peptide formation by activation with carbon monoxide (CO) under hot aqueous conditions in the presence of freshly coprecipitated colloidal (Fe,Ni)S. We now show that CO-driven peptide formation proceeds concomitantly with CO-driven, N-terminal peptide degradation by racemizing N-terminal hydantoin and urea derivatives to alpha-amino acids. This establishes a peptide cycle with closely related anabolic and catabolic segments. The hydantoin derivative is a purin-related heterocycle. The (Fe,Ni)S-dependent urea hydrolysis could have been the evolutionary precursor of the nickelenzyme urease. The results support the theory of a chemoautotrophic origin of life with a CO-driven, (Fe,Ni)S-dependent primordial metabolism.