All phosphoinositide-specific phospholipases C (PLC) identified until today exhibit a high degree of similarity within two regions of 170 and 260 residues, respectively, which are designated regions X and Y. The PLC beta family, including four members designated PLC beta 1, PLC beta 2, PLC beta 3 and PLC beta 4, is regulated by heterotrimeric G proteins. In order to investigate structure-function relationships of PLC beta 2, we expressed PLC beta 2 Delta, a deletion mutant of PLC beta 2 which lacks most of the sequence downstream of region Y, in the baculovirus/insect cell system. The mutant was present in both soluble and particulate fractions of Sf9 cells and was demonstrated to be catalytically active and sensitive to py-subunits. Sf9 cytosol containing this mutant was subjected to limited proteolysis by trypsin and S. aureus protease V8, respectively. Immunochemical analysis revealed that both proteases cleaved the enzyme between the regions X and Y. Most interestingly, proteolytic cleavage at this site by both proteases stimulated the catalytic activity of PLC2 beta 2 Delta. The proteolytically activated enzyme was still sensitive to beta gamma-subunits and showed an unchanged concentration dependence on Ca2+. Gel filtration chromatography indicated that the fragments generated by cleavage between the regions X and Y were still connected and formed a functional heterodimeric complex. In order to visualize all fragments generated by protease V8, PLC beta 2 Delta was purified to homogeneity from Sf9 cytosol. Limited proteolysis of the purified enzyme by S. aureus protease V8 and subsequent SDS/PAGE and silver staining revealed that several cuts take place between the regions X and Y and that the resulting fragments remain intact. We hypothesize that the activating proteolytic cut induces a conformational change of the enzyme which might facilitate hydrolysis of the phospholipid substrate.