Proteasomes are the primary sites for protein degradation in mammalian cells. Each proteasome particle contains two chymotrypsin-like, two trypsin-like, and two caspase-like proteolytic sites. Previous studies suggest a complex network of allosteric interactions between these catalytic and multiple regulatory sites. We used positional scanning combinatorial substrate libraries to determine the extended substrate specificity of the caspase-like sites. Based on this analysis, several new substrates were synthesized, the use of which confirmed earlier observations that caspase-like sites (often termed postglutamyl peptide hydrolase) cleave after aspartates better than after glutamates. Highly selective inhibitors of the caspase-like sites were also generated. They stimulated trypsin-like activity of yeast 20 S proteasomes up to 3-fold but not when binding of the inhibitor to the caspase-like sites was prevented in a mutant carrying an uncleaved propeptide. Although substrates of the caspase-like sites allosterically inhibit the chymotrypsin-like activity, inhibitors of the caspase-like sites do not affect the chymotrypsin-like sites. Furthermore, when caspase-like sites were occupied by the uncleaved propeptide or inhibitor, their substrates still inhibited the chymotrypsin-like activity. Thus, occupancy of the caspase-like sites stimulates the trypsin-like activity of proteasomes, but substrates of the caspase-like sites inhibit the chymotrypsin-like activity by binding to a distinct noncatalytic site.