Recombinant forms of the Dengue 2 virus NS3 protease linked to a 40 residue cofactor, corresponding to part of NS2B, have been expressed in Escherichia coli and shown to be active against para-nitroanilide (pNA) substrates comprising the P6-P1 residues of four substrate cleavage sequences. The enzyme is inactive alone or after the addition of a putative 13-residue cofactor peptide, but is active when fused to the 40-residue cofactor, by either a cleavable or a non-cleavable glycine linker. The NS4B/NS5 cleavage site was processed most readily, with optimal processing conditions being pH 9, I = 10mM, 1mM CHAPS, 20% glycerol. A longer 10 residue peptide corresponding to the NS2B/NS3 cleavage site (P6-P4’) was a poorer substrate than the hexapeptide (P6-P1) pNA substrate under these conditions, suggesting that the prime side substrate residues did not contribute significantly to protease binding. We also report the first inhibitors of a cofactor-complexed, catalytically active flavivirus NS3 protease. Aprotinin was the only standard serine protease inhibitor to be active while a number of peptide substrate analogues were found to be competitive inhibitors at micromolar concentrations.