Invertebrates use a wide range of peptides as transmitters and hormones to regulate complex behaviour, physiology and development. These animals, especially those that are amenable to genetic study and are the subject of genome-sequencing projects, provide powerful model systems for understanding the functions of peptidases in controlling the bioactivity of peptides. Neprilysin, a zinc metallopeptidase and a key enzyme in the metabolism of mammalian peptides, is also implicated in the inactivation of peptides at synapses and of circulating peptide hormones in insects and nematodes. A family of neprilysin-like genes are present in the genomes of both Drosophila melanogaster and Caenorhabditis elegans; in C. elegans it seems that individual family members have evolved to take on different physiological functions, because they are expressed in a tissue-specific manner. Angiotensin I-converting enzymes (peptidyl dipeptidase A, angiotensin-converting enzyme) are another group of zinc metallopeptidases found in some invertebrates that lack angiotensin peptides. In D. melanogaster there are two functional angiotensin-converting enzymes that are essential for normal development. One of these (Acer) is expressed in the embryonic heart, whereas the second enzyme (Ance) is expressed in several tissues at different stages of the life cycle. The accumulation of Ance within secretory vesicles of some peptide-synthesizing cells suggests a role for the enzyme in the intracellular processing of insect peptides. Ance is very efficient at cleaving pairs of basic residues from the C-terminus of partly processed peptides, suggesting a novel role for the enzyme in prohormone processing. Invertebrates will continue to provide insights into the evolutionarily conserved functions of known peptidases and of those additional family members that are expected to be identified in the future from genome-sequencing projects.