Distinct intracellular pathways are involved in regulated and constitutive protein secretion from neuronal and endocrine cells, yet the peptide signals and molecular mechanisms responsible for targeting and retention of soluble proteins in secretory granules are incompletely understood. By using confocal microscopy and subcellular fractionation, we examined trafficking of the neuronal and endocrine peptide precursor VGF that is stored in large dense core vesicles and undergoes regulated secretion. VGF cofractionated with secretory vesicle membranes but was not detected in detergent-resistant lipid rafts. Deletional analysis using epitope-tagged VGF suggested that the C-terminal 73-amino acid fragment of VGF, containing two predicted alpha-helical loops and four potential prohormone convertase (PC) cleavage sites, was necessary and sufficient with an N-terminal signal peptide-containing domain, for large dense core vesicle sorting and regulated secretion from PC12 and INS-1 cells. Further transfection analysis identified the sorting sequence as a compact C-terminal alpha-helix and embedded 564RRR566 PC cleavage site; mutation of the 564RRR566 PC site in VGF-(1-65): GFP:VGF-(545-617) blocked regulated secretion, whereas disruption of the alpha-helix had no effect. Mutation of the adjacent 567HFHH570 motif, a charged region that might enhance PC cleavage in acidic environments, also blocked regulated release. Finally, inhibition of PC cleavage in PC12 cells using the membrane-permeable synthetic peptide chloromethyl ketone (decanoyl-RVKR-CMK) blocked regulated secretion of VGF. Our studies define a critical RRR-containing C-terminal domain that targets VGF into the regulated pathway in neuronal PC12 and endocrine INS-1 cells, providing additional support for the proposed role that PCs and their cleavage sites play in regulated peptide secretion.