A detailed investigation of the catalytic mechanism of angiotensin converting enzyme was undertaken in order to establish a molecular basis for its mode of action. These studies include the characterization of the kinetic properties of the enzyme. In particular, a mechanism for the anion activation, a characteristic feature of angiotensin converting enzyme, has been established. The active site of the enzyme contains a catalytically essential zinc atom which appears to be directly involved in the hydrolytic step of catalysis. Further components of the active site are the carboxyl group of an aspartyl or glutamyl residue, tyrosyl, arginyl and lysyl residues. The latter one is involved in mediating the anion activation. These results have enabled us to compare the active site of angiotensin converting enzyme with those of two other zinc peptidases and, thereby, deduce a mechanism for its mode of action. These investigations have confirmed a hypothetical model of the active site of angiotensin converting enzyme which has served to construct potent inhibitors of the enzyme now being used as anti-hypertensive agents.