Experiments using recombinant vaccinia viruses expressing rat proinsulin I coinfected into COS-7 cells with recombinant vaccinia virus expressing human furin, human PC2, mouse PC3 (subtilisin-related proprotein convertases 1-3, respectively), or yeast Kex2 indicate that in this system both Kex2 and furin produce mature insulin, whereas PC2 selectively cleaves proinsulin at the C-peptide-A-chain junction. This is a property consistent with its probable identity with the rat insulinoma granule type II proinsulin processing activity as described by Davidson et al. [Davidson, H. W., Rhodes, C. J. & Hutton, J. C. (1988) Nature (London) 333, 93-96]. PC3 generates mature insulin but cleaves preferentially at the proinsulin B-chain-C-peptide junction. This pattern of cleavage by PC3 is similar, but not identical, to that of the highly B-chain-C-peptide junction-selective type I activity as described by Davidson et al., perhaps due to the presence of a P4 arginine residue near the C-peptide-A-chain junction unique to the rat proinsulins. These results along with data presented on the expression of both PC2 and PC3 in islet beta cells strongly support the conclusion that these proteases are involved in the conversion of proinsulin to insulin in vivo.