Glutamate carboxypeptidase II (GCPII) is a membrane peptidase expressed in the prostate, central and peripheral nervous system, kidney, small intestine, and tumor-associated neovasculature. The GCPII form expressed in the central nervous system, termed NAALADase, is responsible for the cleavage of N-acetyl-L-aspartyl-L-glutamate (NAAG) yielding free glutamate in the synaptic cleft, and is implicated in various pathologic conditions associated with glutamate excitotoxicity. The prostate form of GCPII, termed prostate-specific membrane antigen (PSMA), is up-regulated in cancer and used as an effective prostate cancer marker. Little is known about the structure of this important pharmaceutical target. As a type II membrane protein, GCPII is heavily glycosylated. In this paper we show that N-glycosylation is vital for proper folding and subsequent secretion of human GCPII. Analysis of the predicted N-glycosylation sites also provides evidence that these sites are critical for GCPII carboxypeptidase activity. We confirm that all predicted N-glycosylation sites are occupied by an oligosaccharide moiety and show that glycosylation at sites distant from the putative catalytic domain is critical for the NAAG-hydrolyzing activity of GCPII calling the validity of previously described structural models of GCPII into question.