A thiol-activated, alpha-N-benzoylarginine-2-naph-thylamide (BANA) hydrolyzing enzyme was purified from rat skin by ammonium sulfate precipitation, gel filtration, and DEAE cellulose chromatography. In DEAE cellulose chromatography the enzyme was fractionated into two multiple forms (preparations I and II). The activity of undiluted preparation II, but not that of preparation I, was increased, when the enzyme was preincubated at pH 4, at 55 degrees C. Simultaneously, the isoelectric point of preparation II was shifted to that of preparation I, i.e., from 6.2 to 7.5. Activated preparation II behaved in DEAE cellulose chromatography as preparation I. Molecular weights of the enzymes of both preparations were 27 000, and pH optima were at pH 5.8 and 7.0, for BANA and leucine-2-napthylamide (Leu-NA), respectively. The BANA and Leu-NA hydrolyzing enzymes could not be separated by gel filtration, DEAE, CM, or Amberlite IRC-50 chromatography, isoelectric focusing, or analytical polyacrylamide gel electrophoresis. Two inhibitors of BANA hydrolase were demonstrated by gel filtration in the salt precipitated skin extract. The activities of the BANA hydrolase preparations did not increase linearly with increasing enzyme concentration, with the exceptions of activities of preparation I and acid-activated preparation II. The role of the inhibitors in the nonlinearity of the activity/enzyme concentration curves is discussed.