Reabsorption and/or degradation of proteins or peptides are functions of the proximal tubule. Large polypeptides or proteins are reabsorbed by luminal endocytosis and hydrolyzed by lysosomal enzymes. Our recent studies indicate that small linear peptides are hydrolyzed at the luminal membrane, with reabsorption of metabolites. The renal transport and hydrolysis of radiolabeled Al, All, BKN, oxytocin, glucagon, insulin, and LHRH were studied. Techniques for in vivo microinfusion of surface tubules in rats, arterial infusion in filtering and nonfiltering rat kidneys in vivo, and in vitro microperfusion of isolated rabbit nephron segments were used. Reabsorption of radiolabeled material was measured and the intact peptide or its metabolites were identified and quantified in urine, renal venous blood, bathing medium, and/or collection fluid. In addition, peptides were incubated in the presence of isolated renal membrane preparations to identify a probably cellular site of hydrolysis. The findings indicate that in proximal, but not distal tubules, radiolabeled Al, All, BKN, glucagon, and LHRH are hydrolyzed by brush border enzymes at the luminal membrane, followed by reabsorption of metabolites. In addition, it was found that, similar to the small intestine, the proximal tubule reabsorbed small peptide fragments, which were further degraded intracellurarly, In vivo inhibition studies with excess peptides revealed that hydrolysis is a more specific process than studies with excess peptides revealed that hydrolysis is a more specific process than reabsorption of metabolites. Large or small, complex peptides like insulin, oxytocin, or vasopressin that contain disulfide bridges are not hydrolyzed at the luminal brush border of the proximal tubule. In vivo sequestration and slow degradation of insulin by rat tubules suggest that this peptide is reabsorbed by endocytosis and degraded in lysosomes. Thus, as the molecular complexity or weight of a peptide increases, the mechanism for renal tubular degradation, instead of depending on luminal membrane hydrolysis, may primarily involve endocytosis and lysosomal digestion. This recently described mechanism for hydrolysis and transport of small linear peptides in the proximal nephron is characterized by having a high capacity and is analogous to membrane hydrolysis described for intestinal microvilli. The process may be biologically important to (1) conserve amino acids, (2) inactivate toxic peptides, and (3) help regulate circulating levels of peptide hormones.