The cholecystokinin-8 (CCK-8)-inactivating peptidase is a serine peptidase which has been shown to be a membrane-bound isoform of tripeptidyl peptidase II (EC 3.4.14.10). It cleaves the neurotransmitter CCK-8 sulfate at the Met-Gly bond to give Asp-Tyr(SO(3)H)-Met-OH + Gly-Trp-Met-Asp-Phe-NH(2). In seeking a reversible inhibitor of this peptidase, the enzymatic binding subsites were characterized using a fluorimetric assay based on the hydrolysis of the artificial substrate Ala-Ala-Phe-amidomethylcoumarin. A series of di- and tripeptides having various alkyl or aryl side chains was studied to determine the accessible volume for binding and to probe the potential for hydrophobic interactions. From this initial study the tripeptides Ile-Pro-Ile-OH (K(i) = 1 microM) and Ala-Pro-Ala-OH (K(i) = 3 microM) and dipeptide amide Val-Nvl-NHBu (K(i) = 3 microM) emerged as leads. Comparison of these structures led to the synthesis of Val-Pro-NHBu (K(i) = 0.57 microM) which served for later optimization in the design of butabindide, a potent reversible competitive and selective inhibitor of the CCK-8-inactivating peptidase. The strategy for this work is explicitly described since it illustrates a possible general approach for peptidase inhibitor design.