Metarhizium anisopliae produces chitinolytic enzymes which have been implicated in digestion of the cuticles of the host insect during the infection process. In this study, enzymatically produced fungal protoplasts and whole mycelium have been used to study the cellular location and regulation of these enzymes. Intact mycelium was not significantly induced by soluble carboxymethylated (alkaline) chitin in the production of chitinolytic enzymes. In contrast, enzymatically produced protoplasts of M. anisopliae were highly inducible for these enzymes. At 24 h incubation, chitin induced protoplasts secreted into the medium 76% of total N-acetylglucosaminidase activity, whereas less than 10% of chitinase activity was secreted. At 48 h incubation, however, N-acetylglucosaminidase secretion had dropped to 34% of total activity, while the proportion of chitinase activity secreted by protoplasts continued to rise. By 48 h, the majority of chitinolytic enzyme activity had become cell-bound in both protoplast preparations and whole cells, and in protoplasts, this activity was mainly located in the membrane/developing wall fraction. The influence of the cell wall in the regulation and secretion of these enzymes is discussed.