Substance P (SP), an amidated peptide present in many sensory nerves, is known to affect cardiovascular function, and exogenously supplied SP has been shown to activate nitric oxide synthase (NOS) in endothelial cells. We now report that SP-Gly, the glycine-extended biosynthetic precursor of SP (which is enzymatically processed to the mature amidated SP), causes relaxation of rat aortic strips with an efficacy and potency comparable to that of SP itself. Pretreatment of the aortic strips with 4-phenyl-3-butenoic acid (PBA), an irreversible amidating enzyme inactivator, results in marked inhibition of the vasodilation activity induced by SP-Gly but not of that induced by SP itself. Isolated endothelial cell basal NOS activity is also decreased by pretreatment with PBA, with no evidence of cell death or direct action of PBA on NOS activity. Both bifunctional and monofunctional forms of amidating enzymes are present in endothelial cells, as evidenced by affinity chromatography and Western blot analysis. These results provide evidence for a link between amidative peptide processing, NOS activation in endothelial cells, and vasodilation and suggest that a product of amidative processing provides intrinsic basal activation of NOS in endothelial cells.