Several pathophysiological conditions are characterized by increased activity of the epithelial sodium channel (ENaC); among them, the nephrotic syndrome. We recently identified plasmin as a stimulator of gENaC activity in nephrotic urine, and this study was undertaken to investigate the mechanism by which plasmin stimulates ENaC activity. Using small interference RNA (siRNA), expression of the gENaC subunit was knocked down in the mouse cortical collecting cell line M-1, which prevented stimulation of gENaC activity by plasmin. Recent evidence indicates that prostasin, a glycosylphosphatidylinositol (GPI)-anchored serine protease, activates ENaC by proteolytic cleavages of the subunit, leading to the release of a peptide from the extracellular domain. To explore if plasmin-stimulation led to a similar response, a hexa-histidine tag was introduced in the proposed peptide and the tagged gENaC subunit in M-1 cells. The hexahistidine tag was readily visualized in untreated cells by fluorescence microscopy using the fluorophore NTA-Atto550; however, treatment with plasmin abolished labeling. Using biotin-label transfer technique, we found that plasmin interacts with prostasin on M-1 cells. Stimulation of M-1 cells with plasmin induced cleavage of prostasin, which was inhibited by mutation of the activation-site within prostasin. Moreover, we found that siRNA knock-down of prostasin prevented plasmin-stimulated ENaC activity in M-1 cells. Release of GPI-anchored proteins from the cell surface of M-1 cells by incubation with phosphatidylinositol-specific phospholipase C, inhibited the plasmin-induced removal of the hexahistidine tagged gENaC subunit. Thus, our data suggest plasmin interacts with prostasin, which leads to cleavage of the g subunit and activation of ENaC.