Peptide-hormones are synthesized as higher-molecular-weight precursor proteins which must undergo numerous posttranslational modifications to yield the bioactive peptide(s) which may include limited endoproteolysis, limited exopeptidase digestion, and C-terminal amidation. Three different enzymes which are likely to be the physiologically relevant processing enzymes of bovine pro-gonadotropin-releasing hormone (pro-GnRH) precursor protein have been colocalized to, and purified from, hypothalamic neurosecretory granules. Gonadotropin-releasing-hormone-associated-peptide-releasing enzyme initiates processing by endoproteolysis of the pro-hormone exclusively at the Arg 13-Asp 14 bond in the sequence, -Gly6-Leu-Arg-Pro-Gly 10-Gly-Lys 12-Arg 13-Asp-, which overlaps the sequence for GnRH (1-10) and GAP(14-69) within the pro-protein. Hypothalamic carboxypeptidase E then sequentially removes the -Lys12-Arg13- doublet from the newly formed peptide before peptidyl glycine alpha-amidating monooxygenase catalyzes the formation of amidated GnRH. Carboxypeptidase E activity is stimulated in vitro by cobalt ion and removes the Lys and Arg residues with equal facility. The residue which acts as the amide nitrogen donor for the alpha-amidating enzyme must be present as the free C-terminal residue of a substrate; the enzyme does not recognize peptide substrates with C-terminal extensions. Based on the mandatory ordered events for processing pro-GnRH and the relative pH profiles displayed by these enzymes, our results are consistent with the idea that endoproteolysis of the pro-hormone occurs upon formation of the secretory granule at the Golgi apparatus and that the processed peptides are the storage form within the secretory vesicles.