AbstractAlthough peptides themselves are not usually the end products of a drug discovery effort, peptide research often plays a key role in many aspects of this process. This will be illustrated by reviewing the experience of peptide research carried out at IRBM in the course of our study of hepatitis C virus (HCV). The target of our work is the NS3/4A protease, which is essential for maturation of the viral polyprotein. After a thorough examination of its substrate specificity we fine‐tuned several substrate‐derived peptides for enzymology studies, high‐throughput screening and as fluorescent probes for secondary binding assays. In the course of these studies we made the key observation: that the protease is inhibited by its own cleavage products. Single analog and combinatorial optimization then derived potent peptide inhibitors. The crucial role of the NS4A cofactor was also addressed. NS4A is a small transmembrane protein, whose central domain is the minimal region sufficient for enzyme activation. Structural studies were performed with a peptide corresponding to the minimal activation domain, with a series of product inhibitors and with both. We found that NS3/4A is an induced fit enzyme, requiring both the cofactorandthe substrate to acquire its bioactive conformation; this explained some puzzling results of ‘serine‐trap’ type inhibitors. A more complete study on NS3 activation, however, requires the availability of the full‐length NS4A protein. This was prepared by native chemical ligation, after sequence engineering to enhance its solubility; structural studies are in progress. Current work is focused on the P′ region of the substrate, which, at variance with the P region, is not used for ground state binding to the enzyme and might give rise to inhibitors showing novel interactions with the enzyme. Copyright © 2001 European Peptide Society and John