Insulin-like growth factor-binding protein (IGFBP)-3 binds the insulin-like growth factors with high affinity and modulates their actions. Proteolytic cleavage of IGFBP-3 may regulate insulin-like growth factor bioavailability. IGFBP-3 is extensively degraded in serum during pregnancy; however, as yet the pregnancy-specific protease, or proteases, have not been identified. We utilized a yeast two-hybrid assay and a human placental cDNA library to investigate IGFBP-3-interacting proteins. A disintegrin and metalloprotease-12 (ADAM 12), a member of a family of metalloprotease disintegrins that is highly expressed in placental tissue, was identified as interacting with IGFBP-3. This interaction involved the cysteine-rich domain of ADAM 12. Unlike other members of this family of disintegrin metalloproteases that are membrane proteins, ADAM 12 exists as an alternatively spliced soluble secreted protein. To verify the interaction between ADAM 12 and IGFBP-3, an expression construct containing an ADAM 12-S cDNA was transfected into COS-1 cells. Co-precipitation was observed when conditioned medium was analyzed by immunoprecipitation with an antibody against either ADAM 12 or IGFBP-3 followed by Western blotting with anti-IGFBP-3 or anti-ADAM 12. Although minimal proteolysis of IGFBP-3 was observed in conditioned medium from control cells, this was increased approximately 4-fold in conditioned medium from ADAM 12-S-transfected cells. Recombinant ADAM 12-S partially purified from conditioned medium on a heparin-Sepharose column also proteolyzed IGFBP-3. The degradation pattern was similar to that seen with pregnancy serum, and the presence of ADAM 12-S in serum during pregnancy was confirmed. The data suggest that ADAM 12-S has IGFBP-3 protease activity, and it may contribute to the IGFBP-3 protease activity present in pregnancy serum.