The enzyme activity of lysosomal cysteine proteinases in vital rabbit osteoclasts and mouse osteoclast-like cells was visualized with Z-Leu-Arg-4-methoxy-beta-naphthylamide (Z-LR-MNA) as the enzyme substrate. The MNA liberated by proteolysis forms a fluorescent insoluble Schiff-base product in the presence of 5-nitrosalicylaldehyde. Many small fluorescent particles, endproducts of the Z-LR-MNA hydrolysis, were observed in proximity to the bone surface underneath the actively resorbing osteoclasts, as well as in the cytoplasm. The Z-LR-MNA hydrolase activity was markedly diminished by bafilomycin A1 and chloroquine treatment. Moreover, the activity was completely inhibited by cysteine proteinase inhibitors such as leupeptin and E-64d, but not by other classes of proteinase inhibitors. About 60% of the hydrolase activity in mouse osteoclast-like cells was immunoabsorbed by anti-cathepsin K antibody-coupled Sepharose CL-4B beads, and about 10% of the activity was absorbed with the anti-cathepsin L antibody-coupled beads. Thus, the majority of the Z-LR-MNA hydrolase activity in osteoclasts was derived from cathepsin K. In contrast, using the same substrate in the assay, no detectable cathepsin K activity was observed in mouse peritoneal macrophages. The abundant cathepsin K activity in osteoclasts would therefore indicate a significant role of this enzyme in bone matrix degradation.