This study evaluated the effects of N-terminal sequence deletion and of chemical modifications on the melanophore pigment dispersing activity of a crustacean neuropeptide (DRPH: Asn-Ser-Gly-Met-Ile-Asn-Ser-Ile-Leu-Gly-Ile-Pro-Arg-Val-Met-Thr-Glu-Ala-NH2). Sustained biological activity was not demonstrated by peptides smaller than the tridecapeptide DRPH (6-18). N-terminal extension of this peptide led to a steady increase in activity, with the DRPH (1-18) showing the maximum activity. Carboxyl group modification had no effect, but acetylation, oxidation, cyanogen bromide, and trypsin caused a decrease in activity. Phenylglyoxal modification of Arg-13 in DRPH led to a 14-fold increase in activity. It is concluded that the N-terminus and the methionine residues are important for full activity and that the phenylglyoxal-induced potentiation is due to protection of the peptide from proteolysis in vivo.