Apolipoprotein B100 (apoB), the structural component of very low density lipoproteins (VLDL), is susceptible to misfolding and subsequent degradation by several intracellular pathways. ER-60, which has been implicated in apoB degradation, is a protein disulfide isomerase (PDI) that forms or rearranges disulfide bonds in substrate proteins and also possesses cysteine protease activity. To determine which ER-60 function is important for apoB degradation, adenoviruses encoding wild-type human ER-60 or a mutant form of human ER-60 (C60A, C409A) that lacked cysteine protease activity were overexpressed in HepG2 cells. Overexpression of wild-type ER-60 in HepG2 cells promoted apoB degradation and impaired apoB secretion, but mutant ER-60 overexpression did not. In McArdle RH-7777 cells, VLDL secretion was markedly inhibited following overexpression of wild-type but not mutant ER-60, an effect that could be blocked by oleate treatment. Mutant ER-60 was not trapped on apoB as it was with the control substrate tapasin, suggesting that ER-60's role in apoB degradation is likely unrelated to its protein disulfide isomerase activity. Thus, ER-60 may participate in apoB degradation by acting as a cysteine protease. We postulate that apoB cleavage by ER-60 within the ER lumen could facilitate proteasomal degradation of the C-terminus of translocationally-arrested apoB.