The GOLVEN (GLV) gene family encode small secreted peptides involved in important plant developmental programs. Little is known about the factors required for the production of the mature bioactive GLV peptides. Through a genetic suppressor screen in Arabidopsis thaliana, two related subtilase genes, AtSBT6.1 and AtSBT6.2, were identified that are necessary for GLV1 activity. Root and hypocotyl GLV1 overexpression phenotypes were suppressed by mutations in either of the subtilase genes. Synthetic GLV-derived peptides were cleaved in vitro by the affinity-purified SBT6.1 catalytic enzyme, confirming that the GLV1 precursor is a direct subtilase substrate, and the elimination of the in vitro subtilase recognition sites through alanine substitution suppressed the GLV1 gain-of-function phenotype in vivo Furthermore, the protease inhibitor Serpin1 bound to SBT6.1 and inhibited the cleavage of GLV1 precursors by the protease. GLV1 and its homolog GLV2 were expressed in the outer cell layers of the hypocotyl, preferentially in regions of rapid cell elongation. In agreement with the SBT6 role in GLV precursor processing, both null mutants for sbt6.1 and sbt6.2 and the Serpin1 overexpression plants had shorter hypocotyls. The biosynthesis of the GLV signaling peptides required subtilase activity and might be regulated by specific protease inhibitors. The data fit with a model in which the GLV1 signaling pathway participates in the regulation of hypocotyl cell elongation, is controlled by SBT6 subtilases, and is modulated locally by the Serpin1 protease inhibitor.