Peptide neurotransmitters and peptide hormones, collectively known as neuropeptides, are required for cell-cell communication in neurotransmission and for regulation of endocrine functions. Neuropeptides are synthesized from protein precursors (termed proneuropeptides or prohormones) that require proteolytic processing primarily within secretory vesicles that store and secrete the mature neuropeptides to control target cellular and organ systems. This review describes interdisciplinary strategies that have elucidated two primary protease pathways for prohormone processing consisting of the cysteine protease pathway mediated by secretory vesicle cathepsin L and the well-known subtilisin-like proprotein convertase pathway that together support neuropeptide biosynthesis. Importantly, this review discusses important areas of current and future biomedical neuropeptide research with respect to biological regulation, inhibitors, structural features of proneuropeptide and protease interactions, and peptidomics combined with proteomics for systems biological approaches. Future studies that gain in-depth understanding of protease mechanisms for generating active neuropeptides will be instrumental for translational research to develop pharmacological strategies for regulation of neuropeptide functions. Pharmacological applications for neuropeptide research may provide valuable therapeutics in health and disease.