Processing and metabolism of beta-amyloid precursor protein (APP) and generation of a variety of beta-amyloid (Abeta) peptides in the human brain is essentially associated with pathophysiology of Alzheimer's disease (AD). APP degradation activity of the 68 kDa serine protease, which was originally prepared from familial AD lymphoblastoid cells and harbors beta-secretase-like activity, was analyzed by Western blot using anti Abeta 1/40 antibody and anti APP cytoplasmic domain (CT) antibody. Native lymphocyte APP (LAPP) prepared from normal or AD-derived lymphoblastoid cells was degraded by the protease, generating a 16 kDa Abeta-bearing C-terminal fragment of APP. N-terminal amino acid sequencing of the fragment indicated that the protease cleaves LAPP at the Abeta-N-terminus. When the LAPP was treated with chondroitinase ABC prior to proteolysis, the activity to generate the fragment was inhibited, but pretreatment with heparitinase resulted in no effect. Native hippocampal APP prepared from normal brain, however, did not generate the 16 kDa peptide by the protease treatment. These results suggest that the process of APP degradation and Abeta-peptides generation, including beta-secretase activity, is associated with tissue specificity of both APP substrate and proteases. They also indicate that sulfated glycoconjugates attached to a portion of APP isoforms may play a role as a molecular determinant in the proteolysis.