The synaptic serine protease neurotrypsin is thought to be important for adaptive synaptic processes required for cognitive functions, because humans deficient in neurotrypsin suffer from severe mental retardation. In the present study, we describe the biochemical characterization of neurotrypsin and its so far unique substrate agrin. In cell culture experiment as well as in neurotrypsin-deficient mice, we showed that agrin cleavage depends on neurotrypsin and occurs at two conserved sites. Neurotrypsin and agrin were expressed recombinantly, purified, and assayed in vitro. A catalytic efficiency of 1.3 x 10⁴ M^-1 · s^-1 was determined. Neurotrypsin activity was shown to depend on calcium with an optimal activity in the pH range of 7-8.5. Mutagenesis analysis of the amino acids flanking the scissile bonds showed that cleavage is highly specific due to the unique substrate recognition pocket of neurotrypsin at the active site. The C-terminal agrin fragment released after cleavage has recently been identified as an inactivating ligand of the Na⁺/K⁺-ATPase at CNS synapses, and its binding has been demonstrated to regulate presynaptic excitability. Therefore, dysregulation of agrin processing is a good candidate for a pathogenetic mechanism underlying mental retardation. In turn, these results may also shed light on mechanisms involved in cognitive functions.--Reif, R., Sales, S., Hettwer, S., Dreier, B., Gisler, C., Wölfel, J., Lüscher, D., Zurlinden, A., Stephan, A., Ahmed, S., Baici, A., Ledermann, B., Kunz, B., Sonderegger, P. Specific cleavage of agrin by neurotrypsin, a synaptic protease linked to mental retardation.