Polyethylene glycol-modified papain catalyzed the oligomerization of amino acid amides in toluene. The water content of the organic solvent was a critical factor determining the extent of polymerization. Under optimized conditions, lysine and phenylalanine oligomers containing up to 10 residues were obtained. In sharp contrast to what is observed in aqueous media, hydrophilic and basic amino acid derivatives resulted in higher reaction yields than hydrophobic amino acid derivatives.