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Nylon hydrolase (NylC), a member of the N-terminal nucleophile (Ntn) hydrolase superfamily, is responsible for the degradation of various aliphatic nylons, including nylon-6 and nylon-66. NylC is initially expressed as an inactive precursor (36 kDa), but the precursor is autocatalytically cleaved at Asn266/Thr267 to generate an active enzyme composed of 27 and 9 kDa subunits. We isolated various mutants with amino acid changes at the catalytic centre. X-ray crystallographic analysis revealed that the NylC precursor forms a doughnut-shaped quaternary structure composed of four monomers (molecules A-D) with D2 symmetry. Catalytic residues in the precursor are covered by loop regions at the A/B interface (equivalent to the C/D interface). However, the catalytic residues are exposed to the solvent environment through autocleavage followed by movements of the loop regions. T267A, D306A and D308A mutations resulted in a complete loss of autocleavage. By contrast, in the T267S mutant, autocleavage proceeded slowly at a constant reaction rate (k = 2.8 × 10-5  s-1) until complete conversion, but the reaction was inhibited by K189A and N219A mutations. Based on the crystallographic and molecular dynamic simulation analyses, we concluded that the Asp308-Asp306-Thr267 triad, resembling the Glu-Ser-Ser triad conserved in Ntn-hydrolase family enzymes, is responsible for autocleavage and that hydrogen-bonding networks connecting Thr267 with Lys189 and Asn219 are required for increasing the nucleophilicity of Thr267-OH in both the water accessible and water inaccessible systems. Furthermore, we determined that NylC employs the Asp308-Asp306-Thr267 triad as catalytic residues for substrate hydrolysis, but the reaction requires Lys189 and Tyr146 as additional catalytic/substrate-binding residues specific for nylon hydrolysis.