- Members of the Signal Peptide-Peptidase (SPP) and Signal Peptide-Peptidase-like (SPPL) family are intramembrane aspartyl-proteases like their well-studied homologs, the presenilins, which comprise the catalytically active subunit within the γ-secretase complex. The lack of in vitro cleavage assays for SPPL proteases limited their biochemical characterization as well as substrate identification and validation. So far, SPPL proteases have been analyzed exclusively in intact cells or membranes, restricting mechanistic analysis to co-expression of enzyme and substrate variants colocalizing in the same subcellular compartments. We describe the details of developing an in vitro cleavage assay for SPPL2b and its model substrate TNFα and analyzed the influence of phospholipids, detergent supplements, and cholesterol on the SPPL2b in vitro activity. SPPL2b in vitro activity resembles mechanistic principles that have been observed in a cellular context, such as cleavage sites and consecutiveMembers of the Signal Peptide-Peptidase (SPP) and Signal Peptide-Peptidase-like (SPPL) family are intramembrane aspartyl-proteases like their well-studied homologs, the presenilins, which comprise the catalytically active subunit within the γ-secretase complex. The lack of in vitro cleavage assays for SPPL proteases limited their biochemical characterization as well as substrate identification and validation. So far, SPPL proteases have been analyzed exclusively in intact cells or membranes, restricting mechanistic analysis to co-expression of enzyme and substrate variants colocalizing in the same subcellular compartments. We describe the details of developing an in vitro cleavage assay for SPPL2b and its model substrate TNFα and analyzed the influence of phospholipids, detergent supplements, and cholesterol on the SPPL2b in vitro activity. SPPL2b in vitro activity resembles mechanistic principles that have been observed in a cellular context, such as cleavage sites and consecutive turnover of the TNFα transmembrane domain. The novel in vitro cleavage assay is functional with separately isolated protease and substrate and amenable to a high throughput plate-based readout overcoming previous limitations and providing the basis for studying enzyme kinetics, catalytic activity, substrate recognition, and the characteristics of small molecule inhibitors. As a proof of concept, we present the first biochemical in vitro characterization of the SPPL2a and SPPL2b specific small molecule inhibitor SPL-707.…