Abstract Cathepsin V is a lysosomal cysteine peptidase highly expressed in corneal epithelium; however, its function in the eye is still unknown. Here, we describe the capability of cathepsin V to hydrolyze plasminogen, which is also expressed in human cornea at levels high enough to produce physiologically relevant amounts of angiostatin-related molecules. The co-localization of these two proteins suggests an important role for the enzyme in the maintenance of corneal avascularity, essential for optimal visual performance. Sodium dodecyl sulfate-polyacrylamide gel electrophoretic analysis of plasminogen digestion by cathepsin V revealed the generation of three major products of 60, 50 and 40 kDa, which were electrotransferred to polyvinylidene difluoride membranes and excised for characterization. NH(2)-terminal amino acid sequencing of these fragments revealed the sequences EKKVYL, TEQLAP and LLPNVE, respectively. These data are compatible with cleavage sites at plasminogen F94-E95, S358-T359 and V468-L469 peptide bonds generating fragments of the five-kringle domains. In contrast, we did not detect any plasminogen degradation by cathepsins B, K and L. Using a Matrigel assay, we confirmed the angiogenesis inhibition activity on endothelial cells caused by plasminogen processing by cathepsin V. Our results suggest a novel physiological role for cathepsin V related to the control of neovascularization in cornea.