TAR DNA‐binding protein 43 (TDP‐43) is a nuclear protein involved in RNA splicing and a major protein component in ubiquitin‐positive, tau‐negative inclusions of frontotemporal lobar degeneration and amyotrophic lateral sclerosis. Under disease conditions, TDP‐43 redistributes to the cytoplasm where it can be phosphorylated, ubiquitinated, and proteolytically cleaved. Enzymes responsible for TDP‐43 proteolytic processing in brain remain largely unreported. Using a MS approach, we identified two truncated TDP‐43 peptides, terminating C‐terminal to asparagines 291 (N291) and 306 (N306). The only documented mammalian enzyme capable of cleaving C‐terminal to asparagine is asparaginyl endopeptidase (AEP). TDP‐43‐immunoreactive fragments (∼35 and 32 kDa) predicted to be generated by AEP cleavage at N291 and N306 were observed by Western blot analyses of postmortem frontotemporal lobar degeneration brain tissue and cultured human cells over‐expressing TDP‐43. Studies in vitro determined that AEP can directly cleave TDP‐43 at seven sites, including N291 and N306. Western blots of brain homogenates isolated from AEP‐null mice and wild‐type littermate controls revealed that TDP‐43 proteolytic fragments were substantially reduced in the absence of AEP in vivo. Taken together, we conclude that TDP‐43 is cleaved by AEP in brain. Moreover, these data highlight the utility of combining proteomic strategies in vitro and in vivo to provide insight into TDP‐43 biology that will fuel the design of more detailed models of disease pathogenesis.