Activation of factor VIII by thrombin occurs via limited proteolysis at R372, R740, and R1689. The resultant active factor VIIIa molecule consists of three noncovalently associated subunits: Al-a1, A2-a2, and A3- C1-C2 (50, 45, and 73 kDa respectively). Further proteolysis of factor VIIIa at R336 and R562 by activated protein C subsequently inactivates this cofactor. We now find that the factor VIIa- tissue factor complex (VIIa- TF/PL), the trigger of blood coagulation with restricted substrate specificity, can also catalyze limited proteolysis of factor VIII. Proteolysis of factor VIII was observed at 10 sites, producing 2 major fragments (47 and 45 kDa) recognized by an anti-factor VIII A2 domain antibody. Time courses indicated the slow conversion of the large fragment to 45 kDa, followed by further degradation into at least two smaller fragments. N-Terminal sequencing along with time courses of proteolysis indicated that VIIa-TF/PL cleaved factor VIII first at R740, followed by concomitant cleavage at R336 and R372. Although cleavage of the light chain at R1689 was observed, the majority remained uncleaved after 17 h. Consistent with this, only a transient 2-fold increase in factor VIII clotting activity was observed. Thus, heavy chain cleavage of factor VIII by VIIa-TF/PL produces an inactive factor VIII cofactor no longer capable of activation by thrombin. In addition, VIIa-TF/PL was found to inactivate thrombin-activated factor VIII. We hypothesize that these proteolyses may constitute an alternative pathway to regulate coagulation under certain conditions. In addition, the ability of VIIa-TF/PL to cleave factor VIII at 10 sites greatly expands the known protein substrate sequences recognized by this enzyme-cofactor complex.