Proinsulin is converted into insulin by the action of two endoproteases. Type I (PC1/PC3) is thought to cleave between the B-chain and the connecting peptide (C-peptide) and type II (PC2) between the C-peptide and the A-chain. An acidic region immediately C-terminal to the point of cleavage at the B-chain/C-peptide junction is well conserved throughout evolution and has been suggested to be important for proinsulin conversion [Gross, Villa-Komaroff, Kahn, Weir and Halban (1989) J. Biol. Chem. 264, 21486-21490]. We have here compared the precise role of this region as a whole and just the first acidic residue C-terminal to the point of cleavage in processing of proinsulin by PC3. To this end, several mutations were introduced in this region of human proinsulin (native sequence, B-chain RREAEDL C-peptide): RRPAEDL (C1Pro mutant); RRLAEDL (C1Leu mutant); RRL (C1-C4del mutant); RRE (del-C1Glu mutant). Mutant and native cDNAs were stably transfected into AtT20 (pituitary corticotroph) cells, in which PC3 is known to be the major conversion endoprotease, and kinetics of proinsulin conversion were studied (pulse-chase/HPLC analysis of proinsulin-related peptides). The results show that the acidic region following the B-chain/C-peptide junction is indeed important for PC3 cleavage at this site, and that the reduced cleavage observed for the C1-C4del mutant proinsulin can be partially overcome by replacing the acidic region with a single acidic residue (del-C1Glu mutant). Replacing only the first residue of the acidic region with leucine (C1Leu mutant) has no impact on conversion, whereas its replacement with proline (C1Pro mutant) almost completely abolishes cleavage at the B-chain/C-peptide junction without affecting that at the C-peptide/A-chain junction.