We have investigated the degradation of 125I-labeled bovine serum albumin by lysates of rat kidney cortical lysosomes. Maximal degradation of albumin occurred at pH 3.5-4.2, with approximately 70% of the maximal rate occurring at pH 5.0. Degradation was proportional to lysosomal protein concentration (range 100-600 micrograms) and time of incubation (1-5 h). Dithioerythritol (2 mM) stimulated albumin degradation 5- to 10-fold. Albumin degradation was not inhibited by phenylmethanesulfonyl fluoride (1 mM) or EDTA (5 mM), indicating that neither serine nor metalloproteinases are involved to a significant extent. Pepstatin (5 micrograms/ml), an inhibitor of aspartic proteinases, inhibited albumin degradation by approximately 50%. Leupeptin (10 microM) and N-ethylmaleimide (10 mM), inhibitors of cysteine proteinases, decreased albumin degradation by 34 and 65%, respectively. Combinations of aspartic and cysteine proteinase inhibitors produced nearly complete inhibition of albumin degradation. Taken together, these data indicate that aspartic and cysteine proteinases are primarily responsible for albumin degradation by renal cortical lysosomes under these conditions. In keeping with the above data, we have measured high activities of the cysteine proteinases, cathepsins B, H, and L, in cortical tubules, the major site of renal protein degradation. Using the peptidyl 7-amino-4-methylcoumarin (NHMec) substrates (Z-Arg-Arg-NHMec, for cathepsin B; Arg-NHMec for cathepsin H; and Z-Phe-Phe-CHN2-inhibitable hydrolysis of Z-Phe-Arg-NHMec corrected for inhibition of cathepsin B activity for cathepsin L) values obtained were (means +/- SE, mU/mg protein, 1 mU = production of 1 nM product/min, n = 6): cathepsin B, 2.1 +/- 0.34; cathepsin H, 1.35 +/- 0.19; cathepsin L, 14.49 +/- 1.26. In comparison, the activities of cathepsins B, H, and L in liver were: 0.56 +/- 0.03, 0.28 +/- 0.04, and 1.27 +/- 0.16, respectively.