The substrate specificity of rat mast cell protease I (RMCP I), a chymotrypsin-like serine protease localized in the secretory granules of mast cells, was compared to that of bovine alpha-chymotrypsin by using several peptide and protein substrates of known amino acid sequences. Although the overall specificities of the two proteases appeared similar, subtle but significant differences were observed. RMCP I was more prone than chymotrypsin to hydrolyze peptide bonds consisting of Leu-Xaa or two hydrophobic residues--e.g., Phe-Phe. Additionally, the hydrolysis of angiotensin I catalyzed by chymotrypsin, but not by RMCP I, resulted in the generation of angiotensin II as an intermediate product. In contrast to the solubilized enzyme, the RMCP I activity within the insoluble granules was completely stable for at least 2 months in suitable buffers at pH 8.0 or pH 7.2, at 4 degrees C. Carboxypeptidase A activity associated with isolated mast cell granules was completely inhibited by 10 mM o-phenanthroline. Polypeptides smaller than apomyoglobin (17,199 Da) were rapidly hydrolyzed by granule-bound RMCP I, whereas apomyoglobin and other larger proteins were not hydrolyzed. In contrast, the free protease readily hydrolyzed the larger proteins. Neither normal rat serum nor alpha 1-antitrypsin, both of which inhibited the activity of free RMCP I, was effective in inhibiting granule-associated RMCP I. The results indicate that granule-bound RMCP I is not released into solution from isolated secretory granules under physiological conditions of ionic strength and pH and that the granule structure limits the size of proteins that can be hydrolyzed by the protease.