Reconstitution of gamma-secretase activity

gamma-Secretase is a membrane protein complex with an unusual aspartyl protease activity that catalyses the regulated intramembranous cleavage of the beta-amyloid precursor protein (APP) to release the Alzheimer's disease (AD)-associated amyloid beta-peptide (Abeta) and the APP intracellular domain (AICD). Here we show the reconstitution of gamma-secretase activity in the yeast Saccharomyces cerevisiae, which lacks endogenous gamma-secretase activity. Reconstituted gamma-secretase activity depends on the presence of four complex components including presenilin (PS), nicastrin (Nct), APH-1 (refs 3-6) and PEN-2 (refs 4, 7), is associated with endoproteolysis of PS, and produces Abeta and AICD in vitro. Thus, the biological activity of gamma-secretase is reconstituted by the co-expression of human PS, Nct, APH-1 and PEN-2 in yeast.     

New protease inhibitors prevent gamma-secretase-mediated production of Abeta40/42 without affecting Notch cleavage

We have designed new non-peptidic potential inhibitors of gamma-secretase and examined their ability to prevent production of amyloid-beta 40 (Abeta40) and Abeta42 by human cells expressing wild-type and Swedish-mutant beta-amyloid precursor protein (betaAPP). Here we identify three such agents that markedly reduce recovery of both Abeta40 and Abeta42 produced by both cell lines, and increase that of C99 and C83, the carboxy-terminal fragments of betaAPP that are derived from beta-and alpha-secretase, respectively. Furthermore, we show that these inhibitors do not affect endoproteolysis of endogenous or overexpressed presenilins. These inhibitors are totally unable to affect the mDeltaEnotch-1 cleavage that leads to generation of the Notch intracellular domain (NICD). These represent the first non-peptidic inhibitors that are able to prevent gamma-secretase cleavage of betaAPP without affecting processing of mDeltaEnotch-1 or endoproteolysis of presenilins. The distinction between these two proteolytic events, which are both prevented by disruption of presenilin genes, indicates that although they are intimately linked with betaAPP and Notch maturation, presenilins are probably involved in the control of maturation processes upstream of enzymes that cleave gamma-secretase and Notch.     

Zebrafish (Danio rerio) presenilin promotes aberrant amyloid beta-peptide production and requires a critical aspartate residue for its function in amyloidogenesis.

Alzheimer's disease (AD) is characterized by the invariable accumulation of senile plaques composed of amyloid beta-peptide (Abeta). Mutations in three genes are known to cause familial Alzheimer's disease (FAD). The mutations occur in the genes encoding the beta-amyloid precursor protein (betaAPP) and presenilin (PS1) and PS2 and cause the increased secretion of the pathologically relevant 42 amino acid Abeta42. We have now cloned the zebrafish (Danio rerio) PS1 homologue (zf-PS1) to study its function in amyloidogenesis and to prove the critical requirement of an unusual aspartate residue within the seventh putative transmembrane domain. In situ hybridization and reverse PCR reveal that zf-PS1 is maternally inherited and ubiquitously expressed during embryogenesis, suggesting an essential housekeeping function. zf-PS1 is proteolytically processed to produce a C-terminal fragment (CTF) of approximately 24 kDa similar to human PS proteins. Surprisingly, wt zf-PS1 promotes aberrant Abeta42 secretion like FAD associated human PS1 mutations. The unexpected pathologic activity of wt zf-PS1 may be due to several amino acid exchanges at positions where FAD-associated mutations have been observed. The amyloidogenic function of zf-PS1 depends on the conserved aspartate residue 374 within the seventh putative transmembrane domain. Mutagenizing this critical aspartate residue abolishes endoproteolysis of zf-PS1 and inhibits Abeta secretion in human cells. Inhibition of Abeta secretion is accompanied by the accumulation of C-terminal fragments of betaAPP, suggesting a defect in gamma-secretase activity. These data provide further evidence that PS proteins are directly involved in the proteolytic cleavage of betaAPP and demonstrate that this function is evolutionarily conserved.     

Presenilin-dependent gamma-secretase on plasma membrane and endosomes is functionally distinct

The presenilin (PS)/gamma-secretase complex, which contains not only PS but also Aph-1, PEN-2, and nicastrin, mediates proteolysis of the transmembrane domain of beta-amyloid protein precursor (betaAPP). Intramembrane proteolysis occurs at the interface between the membrane and cytosol (epsilon-site) and near the middle of the transmembrane domain (gamma-site), generating the betaAPP intracellular domain (AICD) and Alzheimer disease-associated Abeta, respectively. Both cleavage sites exhibit some diversity. Changes in the precision of gamma-cleavage, which potentially results in secretion of pathogenic Abeta42, have been intensively studied, while those of epsilon-cleavage have not. Although a number of PS-associated factors have been identified, it is unclear whether any of them physiologically regulate the precision of cleavage by PS/gamma-secretase. Moreover, there is currently no clear evidence of whether PS/gamma-secretase function differs according to the subcellular site. Here, we show that endocytosis affects the precision of PS-dependent epsilon-cleavage in cell culture. Relative production of longer AICDepsilon49 increases on the plasma membrane, whereas that of shorter AICDepsilon51 increases on endosomes; however, this occurs without a concomitant major change in the precision of cleavage at gamma-sites. Moreover, very similar changes in the precision of epsilon-cleavage are induced by alteration of the pH. Our findings demonstrate that the precision of epsilon-cleavage by PS/gamma-secretase changes depending upon the conditions and the subcellular location. These results suggest that the precision of cleavage by the PS/gamma-secretase complex may be physiologically regulated by the subcellular location and conditions.     

The role of presenilin-1 in the gamma-secretase cleavage of the amyloid precursor protein of Alzheimer's disease

Presenilin-1 (PS1) is required for the release of the intracellular domain of Notch from the plasma membrane as well as for the cleavage of the amyloid precursor protein (APP) at the gamma-secretase cleavage site. It remains to be demonstrated whether PS1 acts by facilitating the activity of the protease concerned or is the protease itself. PS1 could have a gamma-secretase activity by itself or could traffic APP and Notch to the appropriate cellular compartment for processing. Human APP 695 and PS1 were coexpressed in Sf9 insect cells, in which endogenous gamma-secretase activity is not detected. In baculovirus-infected Sf9 cells, PS1 undergoes endoproteolysis and interacts with APP. However, PS1 does not cleave APP in Sf9 cells. In CHO cells, endocytosis of APP is required for Abeta secretion. Deletion of the cytoplasmic sequence of APP (APPDeltaC) inhibits both APP endocytosis and Abeta production. When APPDeltaC and PS1 are coexpressed in CHO cells, Abeta is secreted without endocytosis of APP. Taken together, these results conclusively show that, although PS1 does not cleave APP in Sf9 cells, PS1 allows the secretion of Abeta without endocytosis of APP by CHO cells.     

Nicastrin binds to membrane-tethered Notch

The presenilins and nicastrin, a type 1 transmembrane glycoprotein, form high molecular weight complexes that are involved in cleaving the beta-amyloid precursor protein (betaAPP) and Notch in their transmembrane domains. The former process (termed gamma-secretase cleavage) generates amyloid beta-peptide (Abeta), which is involved in the pathogenesis of Alzheimer's disease. The latter process (termed S3-site cleavage) generates Notch intracellular domain (NICD), which is involved in intercellular signalling. Nicastrin binds both full-length betaAPP and the substrates of gamma-secretase (C99- and C83-betaAPP fragments), and modulates the activity of gamma-secretase. Although absence of the Caenorhabditis elegans nicastrin homologue (aph-2) is known to cause an embryonic-lethal glp-1 phenotype, the role of nicastrin in this process has not been explored. Here we report that nicastrin binds to membrane-tethered forms of Notch (substrates for S3-site cleavage of Notch), and that, although mutations in the conserved 312-369 domain of nicastrin strongly modulate gamma-secretase, they only weakly modulate the S3-site cleavage of Notch. Thus, nicastrin has a similar role in processing Notch and betaAPP, but the 312-369 domain may have differential effects on these activities. In addition, we report that the Notch and betaAPP pathways do not significantly compete with each other.     

Evidence that the "NF" motif in transmembrane domain 4 of presenilin 1 is critical for binding with PEN-2

Macromolecular complexes containing presenilins (PS1 and PS2), nicastrin, anterior pharynx defective phenotype 1 (APH-1), and PS enhancer 2 (PEN-2) mediate the intramembranous, gamma-secretase cleavage of beta-amyloid precursor protein (APP), Notch, and a variety of type 1 membrane proteins. We previously demonstrated that PEN-2 is critical for promoting endoproteolysis of PS1 and that the proximal two-thirds of transmembrane domain (TMD) 1 of PEN-2 is required for binding with PS1. In this study, we sought to identify the structural domains of PS1 that are necessary for binding with PEN-2. To address this issue, we generated a series of constructs encoding PS1 mutants harboring deletions or replacements of specific TMDs of PS1-NTF, and examined the effects of encoded molecules on interactions with PEN-2, stabilization and endoproteolysis of PS1, and gamma-secretase activity. We now show that PS1 TMDs 1 and 2 and the intervening hydrophilic loop are dispensable for binding to PEN-2. Furthermore, analysis of chimeric PS1 molecules that harbor replacements of each TMD with corresponding transmembrane segments from the sterol regulatory element-binding protein cleavage activating protein (SCAP) revealed that the PS1-SCAP TMD4 mutant failed to coimmunoprecipitate endogenous PEN-2, strongly suggesting that the fourth TMD of PS1 is required for interaction with PEN-2. Further mutational analyses revealed that the "NF" sequence within the TMD4 of PS1 is the minimal motif that is required for binding with PEN-2, promoting PS1 endoproteolysis and gamma-secretase activity.     

Insensitivity to Abeta42-lowering nonsteroidal anti-inflammatory drugs and gamma-secretase inhibitors is common among aggressive presenilin-1 mutations

Abeta42-lowering nonsteroidal anti-inflammatory drugs (NSAIDs) constitute the founding members of a new class of gamma-secretase modulators that avoid side effects of pan-gamma-secretase inhibitors on NOTCH processing and function, holding promise as potential disease-modifying agents for Alzheimer disease (AD). These modulators are active in cell-free gamma-secretase assays indicating that they directly target the gamma-secretase complex. Additional support for this hypothesis was provided by the observation that certain mutations in presenilin-1 (PS1) associated with early-onset familial AD (FAD) change the cellular drug response to Abeta42-lowering NSAIDs. Of particular interest is the PS1-DeltaExon9 mutation, which provokes a pathogenic increase in the Abeta42/Abeta40 ratio and dramatically reduces the cellular response to the Abeta42-lowering NSAID sulindac sulfide. This FAD PS1 mutant is unusual as a splice-site mutation results in deletion of amino acids Thr(291)-Ser(319) including the endoproteolytic cleavage site of PS1, and an additional amino acid exchange (S290C) at the exon 8/10 splice junction. By genetic dissection of the PS1-DeltaExon9 mutation, we now demonstrate that a synergistic effect of the S290C mutation and the lack of endoproteolytic cleavage is sufficient to elevate the Abeta42/Abeta40 ratio and that the attenuated response to sulindac sulfide results partially from the deficiency in endoproteolysis. Importantly, a wider screen revealed that a diminished response to Abeta42-lowering NSAIDs is common among aggressive FAD PS1 mutations. Surprisingly, these mutations were also partially unresponsive to gamma-secretase inhibitors of different structural classes. This was confirmed in a mouse model with transgenic expression of the PS1-L166P mutation, in which the potent gamma-secretase inhibitor LY-411575 failed to reduce brain levels of soluble Abeta42. In summary, these findings highlight the importance of genetic background in drug discovery efforts aimed at gamma-secretase, suggesting that certain AD mouse models harboring aggressive PS mutations may not be informative in assessing in vivo effects of gamma-secretase modulators and inhibitors.     

Carboxyl-terminal fragments of Alzheimer beta-amyloid precursor protein accumulate in restricted and unpredicted intracellular compartments in presenilin 1-deficient cells

Absence of functional presenilin 1 (PS1) protein leads to loss of gamma-secretase cleavage of the amyloid precursor protein (betaAPP), resulting in a dramatic reduction in amyloid beta peptide (Abeta) production and accumulation of alpha- or beta-secretase-cleaved COOH-terminal fragments of betaAPP (alpha- or beta-CTFs). The major COOH-terminal fragment (CTF) in brain was identified as betaAPP-CTF-(11-98), which is consistent with the observation that cultured neurons generate primarily Abeta-(11-40). In PS1(-/-) murine neurons and fibroblasts expressing the loss-of-function PS1(D385A) mutant, CTFs accumulated in the endoplasmic reticulum, Golgi, and lysosomes, but not late endosomes. There were some subtle differences in the subcellular distribution of CTFs in PS1(-/-) neurons as compared with PS1(D385A) mutant fibroblasts. However, there was no obvious redistribution of full-length betaAPP or of markers of other organelles in either mutant. Blockade of endoplasmic reticulum-to-Golgi trafficking indicated that in PS1(-/-) neurons (as in normal cells) trafficking of betaAPP to the Golgi compartment is necessary before alpha- and beta-secretase cleavages occur. Thus, although we cannot exclude a specific role for PS1 in trafficking of CTFs, these data argue against a major role in general protein trafficking. These results are more compatible with a role for PS1 either as the actual gamma-secretase catalytic activity or in other functions indirectly related to gamma-secretase catalysis (e.g. an activator of gamma-secretase, a substrate adaptor for gamma-secretase, or delivery of gamma-secretase to betaAPP-containing compartments).     

Pharmacological knock-down of the presenilin 1 heterodimer by a novel gamma -secretase inhibitor: implications for presenilin biology

Intramembranous cleavage of the beta-amyloid precursor protein by gamma-secretase is the final processing event generating amyloid-beta peptides, which are thought to be causative agents for Alzheimer's disease. Missense mutations in the presenilin genes co-segregate with early-onset Alzheimer's disease, and, recently, a close biochemical linkage between presenilins and the identity of gamma-secretase has been established. Here we describe for the first time that certain potent gamma-secretase inhibitors are able to interfere with the endoproteolytic processing of presenilin 1 (PS1). In addition, we identified a novel gamma-secretase inhibitor, [1S-benzyl-4R-[1-(5-cyclohexyl-2-oxo-2,3-dihydro-1H-benzo[e][1,4]diazepin-3(R,S)-ylcarbamoyl)-S-ethylcarbamoyl]-2R-hydroxy-5-phenyl-pentyl]-carbamic acid tert-butyl ester (CBAP), which not only physically interacts with PS1, but upon chronic treatment produces a "pharmacological knock-down" of PS1 fragments. This indicates that the observed accumulation of full-length PS1 is caused by a direct inhibition of its endoproteolysis. The subsequent use of CBAP as a biological tool to increase full-length PS1 levels in the absence of exogenous PS1 expression has provided evidence that wild-type PS1 endoproteolysis is not required either for PS1/gamma-secretase complex assembly or trafficking. Furthermore, in cell-based systems CBAP does not completely recapitulate PS1 loss-of-function phenotypes. Even though the beta-amyloid precursor protein cleavage and the S3 cleavage of the Notch receptor are inhibited by CBAP, an impairment of Trk receptor maturation was not observed.     

Presenilin 1 regulates pharmacologically distinct gamma -secretase activities. Implications for the role of presenilin in gamma -secretase cleavage

Presenilins (PSs) are polytopic membrane proteins that have been implicated as potential therapeutic targets in Alzheimer's disease because of their role in regulating the gamma-secretase cleavage that generates the amyloid beta protein (Abeta). It is not clear how PSs regulate gamma-secretase cleavage, but there is evidence that PSs could be either essential cofactors in the gamma-secretase cleavage, gamma-secretase themselves, or regulators of intracellular trafficking that indirectly influence gamma-secretase cleavage. Using presenilin 1 (PS1) mutants that inhibit Abeta production in conjunction with transmembrane domain mutants of the amyloid protein precursor that are cleaved by pharmacologically distinct gamma-secretases, we show that PS1 regulates multiple pharmacologically distinct gamma-secretase activities as well as inducible alpha-secretase activity. It is likely that PS1 acts indirectly to regulate these activities (as in a trafficking or chaperone role), because these data indicate that for PS1 to be gamma-secretase it must either have multiple active sites or exist in a variety of catalytically active forms that are altered to an equivalent extent by the mutations we have studied.     

The mechanism of gamma-secretase activities through high molecular weight complex formation of presenilins is conserved in Drosophila melanogaster and mammals

Mutations in presenilin 1 (PS1) and PS2 genes contribute to the pathogenesis of early onset familial Alzheimer's disease by increasing secretion of the pathologically relevant Abeta42 polypeptides. PS genes are also implicated in Notch signaling through proteolytic processing of the Notch receptor in Caenorhabditis elegans, Drosophila melanogaster, and mammals. Here we show that Drosophila PS (Psn) protein undergoes endoproteolytic cleavage and forms a stable high molecular weight (HMW) complex in Drosophila S2 or mouse neuro2a (N2a) cells in a similar manner to mammalian PS. The loss-of-function recessive point mutations located in the C-terminal region of Psn, that cause an early pupal-lethal phenotype resembling Notch mutant in vivo, disrupted the HMW complex formation, and abolished gamma-secretase activities in cultured cells. The overexpression of Psn in mouse embryonic fibroblasts lacking PS1 and PS2 genes rescued the Notch processing. Moreover, disruption of the expression of Psn by double-stranded RNA-mediated interference completely abolished the gamma-secretase activity in S2 cells. Surprisingly, gamma-secretase activity dependent on wild-type Psn was associated with a drastic overproduction of Abeta1-42 from human betaAPP in N2a cells, but not in S2 cells. Our data suggest that the mechanism of gamma-secretase activities through formation of HMW PS complex, as well as its abolition by loss-of-function mutations located in the C terminus, are highly conserved features in Drosophila and mammals.     

Impas 1 possesses endoproteolytic activity against multipass membrane protein substrate cleaving the presenilin 1 holoprotein

Presenilins (PS1 and PS2) are supposed to be unusual aspartic proteases and components of the gamma-secretase complex regulating cleavage of type I proteins. Multiple mutations in PS1 are a major cause of familial early-onset Alzheimer's disease (AD). We and others recently identified PS-related families of proteins (IMPAS/PSH/signal peptide peptidases (SPP)). The functions of these proteins are yet to be determined. We found that intramembrane protease-associated or intramembrane protease aspartic protein Impas 1 (IMP1)/SPP induces intramembranous cleavage of PS1 holoprotein in cultured cells coexpressing these proteins. Mutations in evolutionary invariant sites in hIMP1 or specific gamma-secretase inhibitors abolish the hIMP1-mediated endoproteolysis of PS1. In contrast, neither AD-like mutations in hIMP1 nor in PS1 substrate abridge the PS1 cleavage. The data suggest that IMP1 is a bi-aspartic polytopic protease capable of cleaving transmembrane precursor proteins. These data, to our knowledge, are a first observation that a multipass transmembrane protein or the integral protease per se may be a primary substrate for an intramembranous proteolysis.     

gamma-Secretase, evidence for multiple proteolytic activities and influence of membrane positioning of substrate on generation of amyloid beta peptides of varying length

gamma-Secretase activity is the final cleavage event that releases the amyloid beta peptide (Abeta) from the beta-secretase cleaved carboxyl-terminal fragment of the amyloid beta protein precursor (APP). No protease responsible for this highly unusual, purportedly intramembranous, cleavage has been definitively identified. We examined the substrate specificity of gamma-secretase by mutating various residues within or adjacent to the transmembrane domain of the APP and then analyzing Abeta production from cells transfected with these mutant APPs by enzyme-linked immunosorbent assay and mass spectrometry. Abeta production was also analyzed from a subset of transmembrane domain APP mutants that showed dramatic shifts in gamma-secretase cleavage in the presence or absence of pepstatin, an inhibitor of gamma-secretase activity. These studies demonstrate that gamma-secretase's cleavage specificity is primarily determined by location of the gamma-secretase cleavage site of APP with respect to the membrane, and that gamma-secretase activity is due to the action of multiple proteases exhibiting both a pepstatin- sensitive activity and a pepstatin-insensitive activity. Given that gamma-secretase is a major therapeutic target in Alzheimer's disease these studies provide important information with respect to the mechanism of Abeta production that will direct efforts to isolate the gamma-secretases and potentially to develop effective therapeutic inhibitors of pathologically relevant gamma-secretase activities.     

Functional domains in presenilin 1: the Tyr-288 residue controls gamma-secretase activity and endoproteolysis

Processing of the Alzheimer amyloid precursor protein (APP) into the amyloid beta-protein and the APP intracellular domain is a proteolysis event mediated by the gamma-secretase complex where presenilin (PS) proteins are key constituents. PS is subjected to an endoproteolytic cleavage, generating a stable heterodimer composed of an N-terminal and a C-terminal fragment. Here we aimed at further understanding the role of PS in endoproteolysis, in proteolytic processing of APP and Notch, and in assembly of the gamma-secretase complex. By using a truncation protocol and alanine scanning, we identified Tyr-288 in the PS1 N-terminal fragment as critical for PS-dependent intramembrane proteolysis. Further mutagenesis of the 288 site identified mutants differentially affecting endoproteolysis and gamma-secretase activity. The Y288F mutant was endoproteolyzed to the same extent as wild type PS but increased the amyloid beta-protein 42/40 ratio by approximately 75%. In contrast, the Y288N mutant was also endoproteolytically processed but was inactive in reconstituting gamma-secretase in PS null cells. The Y288D mutant was deficient in both endoproteolysis and gamma-secretase activity. All three mutant PS1 molecules were incorporated into gamma-secretase complexes and stabilized Pen-2 in PS null cells. Thus, mutations at Tyr-288 do not affect gamma-secretase complex assembly but can differentially control endoproteolysis and gamma-secretase activity.     

The transmembrane aspartates in presenilin 1 and 2 are obligatory for gamma-secretase activity and amyloid beta-protein generation

The discovery that a deficiency of presenilin 1 (PS1) decreases the production of amyloid beta-protein (Abeta) identified the presenilins as important mediators of the gamma-secretase cleavage of beta-amyloid precursor protein (APP). Recently, we found that two conserved transmembrane (TM) aspartates in PS1 are critical for Abeta production, providing evidence that PS1 either functions as a required diaspartyl cofactor for gamma-secretase or is itself gamma-secretase. Presenilin 2 (PS2) shares substantial sequence and possibly functional homology with PS1. Here, we show that the two TM aspartates in PS2 are also critical for gamma-secretase activity, providing further evidence that PS2 is functionally homologous to PS1. Cells stably co-expressing TM Asp --> Ala mutations in both PS1 and PS2 show further accumulation of the APP-derived gamma-secretase substrates, C83 and C99. The production of Abeta is reduced to undetectable levels in the conditioned media of these cells. Furthermore, endoproteolysis of the exogenous Asp mutant PS2 is absent, and endogenous PS1 C-terminal fragments are diminished to undetectable levels. Therefore, the co-expression of PS1 and PS2 TM Asp --> Ala mutants suppresses the formation of any detectable PS1 or PS2 heterodimeric fragments and essentially abolishes the production of Abeta. These results explain the residual Abeta production seen in PS1-deficient cells and demonstrate the absolute requirement of functional presenilins for Abeta generation. We conclude that presenilins, and their TM aspartates in particular, are attractive targets for lowering Abeta therapeutically to prevent Alzheimer's disease.     

The levels of mature glycosylated nicastrin are regulated and correlate with gamma-secretase processing of amyloid beta-precursor protein

Nicastrin, a type-I transmembrane glycoprotein, is a necessary component of the high molecular weight presenilin (PS) complexes that mediate intramembranous cleavage of beta-amyloid precursor protein (betaAPP) and Notch. Nicastrin undergoes trafficking-dependent glycosylation maturation, and PS1 interacts preferentially with these maturely glycosylated forms of nicastrin. We investigated the effects of differing levels of the immature and mature endoglycosidase-H-resistant forms of nicastrin on Abeta40- and Abeta42-peptide secretion in several cell lines stably expressing a mutant nicastrin (D336A/Y337A) that increases Abeta secretion. There was no correlation between Abeta secretion and the level of over-expression of the immature forms of nicastrin. The total level of mature nicastrin remained constant, but mutant nicastrin replaced endogenous mature nicastrin in varying degrees. Differences in the levels of mature mutant nicastrin positively correlated with Abeta secretion, but did not influence either betaAPP trafficking or processing by alpha- and beta-secretases. Proper trafficking and terminal maturation of nicastrin is therefore a necessary event for the regulated intramembranous proteolysis of betaAPP.     

PEN-2 and APH-1 coordinately regulate proteolytic processing of presenilin 1

Presenilin (PS, PS1/PS2) complexes are known to be responsible for the intramembranous gamma-secretase cleavage of the beta-amyloid precursor protein and signaling receptor Notch. PS holoprotein undergoes endoproteolysis by an unknown enzymatic activity to generate NH(2)- and COOH-terminal fragments, a process that is required for the formation of the active and stable PS/-gamma-secretase complex. Biochemical and genetic studies have recently identified nicastrin, APH-1, and PEN-2 as essential cofactors that physically interact with PS1 and are necessary for the gamma-secretase activity. However, their precise function in regulating the PS complex and gamma-secretase activity remains unknown. Here, we demonstrate that endogenous PEN-2 preferentially interacts with PS1 holoprotein. Down-regulation of PEN-2 expression by small interfering RNA (siRNA) abolishes the endoproteolysis of PS1, whereas overexpression of PEN-2 promotes the production of PS1 fragments, indicating a critical role for PEN-2 in PS1 endoproteolysis. Interestingly, accumulation of full-length PS1 resulting from down-regulation of PEN-2 is alleviated by additional siRNA down-regulation of APH-1. Furthermore, overexpression of APH-1 facilitates PEN-2-mediated PS1 proteolysis, resulting in a significant increase in PS1 fragments. Our data reveal a direct role of PEN-2 in proteolytic cleavage of PS1 and a regulatory function of APH-1, in coordination with PEN-2, in the biogenesis of the PS1 complex.