Type II transmembrane serine proteases are an emerging class of proteolytic enzymes involved in tissue homeostasis and a number of human disorders such as cancer. To better define the biochemical functions of a subset of these proteases, we compared the enzymatic properties of matriptase, matriptase-2, hepsin and DESC1 using a series of internally quenched fluorogenic peptide substrates containing o-aminobenzoyl and 3-nitro-tyrosine. We based the sequence of the peptides on the P4 to P4' activation sequence of matriptase (RQAR-VVGG). Positions P4, P3, P2 and P1' were substituted with nonpolar (Ala, Leu), aromatic (Tyr), acid (Glu) and basic (Arg) amino acids, whereas P1 was fixed to Arg. Of the four type II transmembrane serine proteases studied, matriptase-2 was the most promiscuous, and matriptase was the most discriminating, with a distinct specificity for Arg residues at P4, P3 and P2. DESC1 had a preference similar to that of matriptase, but with a propensity for small nonpolar amino acids (Ala) at P1'. Hepsin shared similarities with matriptase and DESC1, but was markedly more permissive at P2. Matriptase-2 manifested broader specificities, as well as substrate inhibition, for selective internally quenched fluorescent substrates. Lastly, we found that antithrombin III has robust inhibitory properties toward matriptase, matriptase-2, hepsin and DESC1, whereas plasminogen activator inhibitor-1 and alpha(2)-antiplasmin inhibited matriptase-2, hepsin and DESC1, and to a much lesser extent, matriptase. In summary, our studies revealed that these enzymes have distinct substrate preferences.