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Abstract: Human glutamate carboxypeptidase II (GCPII) is involved in neuronal signal transduction and intestinal folate absorption by means of the hydrolysis of its two natural substrates, N-acetyl-aspartyl-glutamate and folyl-poly-γ-glutamates, respectively. During the past years, tremendous efforts have been made toward the structural analysis of GCPII. Crystal structures of GCPII in complex with various ligands have provided insight into the binding of these ligands, particularly to the S1′ site of the enzyme. In this article, we have extended structural characterization of GCPII to its S1 site by using dipeptide-based inhibitors that interact with both S1 and S1′ sites of the enzyme. To this end, we have determined crystal structures of human GCPII in complex with phosphapeptide analogs of folyl-γ-glutamate, aspartyl-glutamate, and γ-glutamyl-glutamate, refined at 1.50, 1.60, and 1.67 Å resolution, respectively. The S1 pocket of GCPII could be accurately defined and analyzed for the first time, and the data indicate the importance of Asn519, Arg463, Arg534, and Arg536 for recognition of the penultimate (i.e., P1) substrate residues. Direct interactions between the positively charged guanidinium groups of Arg534 and Arg536 and a P1 moiety of a substrate/inhibitor provide mechanistic explanation of GCPII preference for acidic dipeptides. Additionally, observed conformational flexibility of the Arg463 and Arg536 side chains likely regulates GCPII affinity toward different inhibitors and modulates GCPII substrate specificity. The biochemical experiments assessing the hydrolysis of several GCPII substrate derivatives modified at the P1 position, also included in this report, further complement and extend conclusions derived from the structural analysis. The data described here form an a solid foundation for the structurally aided design of novel low-molecular-weight GCPII inhibitors and imaging agents. [Copyright &y& Elsevier]