The yeast Kex2 protease is the prototype of a family of eukaryotic proprotein processing proteases that includes PC1, PC2, and furin. The catalytic domains of these enzymes are homologous to the degradative serine proteases of the subtilisin family. Kex2 exhibits optimal activity toward substrates with Lys or Arg at P2 and Arg at P1 (Lys-Arg or Arg-Arg cleavage sites). However, mammalian proprotein processing proteases such as furin exhibit more stringent requirements for basic residues at P4 than at P2. Here we demonstrate that Kex2 protease also recognizes P4, with dual specificity for aliphatic and basic residues. Recognition of P4 is even more readily apparent in substrates having a poor P1 residue (Lys). Kinetic analysis of a series of otherwise identical fluorogenic substrates with Lys at P1 and different residues at P4 indicates that large, aliphatic P4 residues increase kcat/KM by 100-fold. However, smaller residues or acidic residues at P4 do not. P4 Arg also confers efficient cleavage on such a substrate, but the uncharged isostere of Arg, citrulline, does not. Kex2 may thus possess distinct subsites that recognize aliphatic or basic P4 side chains. Although a favorable P4 residue can partially compensate for the defects in kcat and kcat/KM seen with Lys in place of Arg at P1, this substitution resulted in a change in rate-determining step for all substrates examined. As previously seen in the case of subtilisin, effects of substitutions at the P1 and P4 positions were not independent, suggesting that interplay between these two positions is a common feature of substrate specificity for both processing proteases and degradative enzymes of the subtilisin superfamily.