gamma-Glutamyl hydrolase is a ubiquitous enzyme that has the capacity to cleave gamma-glutamyl bonds of cellular folyl- and antifolylpoly-gamma-glutamates. This study has revealed that the enzyme is secreted by primary cultures of rat hepatocytes and by H35 hepatoma cells. It was found that more than 99% of the total enzyme from H35 cells accumulated in the medium after 48 hr incubation with the serum-free medium. The cells were shown to remain intact during the secretion period since lactate dehydrogenase, dihydrofolate reductase and lysosomal hydrolases other than gamma-glutamyl hydrolase were retained within the cell. When PteGlu5 (folylGlu4) is used as a substrate the initial product is PteGlu (folate), and there is no appearance of intermediate chain length pteroyl polyglutamates. Therefore, the secreted and cellular gamma-glutamyl hydrolase from hepatoma cells appears to be an endopeptidase. Polyclonal antibodies to the poly-gamma-glutamate substrates of the enzyme were prepared and characterized. The antibodies recognize the structural differences between alpha- and gamma-glutamyl linkages but appear equally active with PteGlu5 and its analogs such as 4-NH2-10-CH3PteGlu5 and pABAGlu5. The affinity of the antibodies is related to the gamma-glutamyl structure since L-glutamic acid, folate or p-aminobenzoic acid are inactive with the antibodies. Furthermore, poly-gamma-glutamate has lower affinity for the antibodies than the poly-gamma-glutamate derivatives of PteGlu, 4-NH2-10-CH3PteGlu or pABA.