Collagenase is synthesized and secreted by stimulated rabbit fibroblasts as a proenzyme that must be proteolytically cleaved to yield catalytically active species. The calcium ionophore A23187 has provided new insights into the regulation of collagenase activation cascade by living cells. A23187, at concentrations of 10-40 ng/ml, induced expression of collagenase and stromelysin mRNA and the secretion of procollagenase of 57 and 53 kDa and prostromelysin of 51 kDa. Interestingly, it also stimulated activation of procollagenase to active forms of 47 and 43 kDa. The concentrations and treatment times required for induction of gene expression and activation indicated that they were independent events. Active collagenase constituted up to 16% of the total collagenase present in medium conditioned by A23187-treated cells. When grown on a collagen substrate, A23187-treated cells degraded collagen in a spatially localized manner. In cells treated with agents that induce procollagenase only, collagenase was localized in the perinuclear Golgi area; however, in A23187-treated cells, collagenase was located in widely dispersed granules, suggesting different intracellular pathways for collagenase before, during, and after activation. Addition of serine, thiol-, and metalloproteinase inhibitors with A23187 to rabbit fibroblasts inhibited conversion of procollagenase to its active form to varying degrees, suggesting that enzymes in these classes are involved in a cascade of proteolytic events leading to collagenase activation.