Components of the renin–angiotensin system are well established targets for pharmacological intervention in a variety of disorders. Many such therapies abrogate the effects of the hypertensive and mitogenic peptide, angiotensin II, by antagonising its interaction with its receptor, or by inhibiting its formative enzyme, angiotensin-converting enzyme (ACE). At the turn of the millennium, a homologous enzyme, termed ACE2, was identified which increasingly shares the limelight with its better-known homologue. In common with ACE, ACE2 is a type I transmembrane metallopeptidase; however, unlike ACE, ACE2 functions as a carboxypeptidase, cleaving a single C-terminal residue from a distinct range of substrates. One such substrate is angiotensin II, which is hydrolysed by ACE2 to the vasodilatory peptide angiotensin 1–7. In this commentary we discuss the latest developments in the rapidly progressing study of the physiological and patho-physiological roles of ACE2 allied with an overview of the current understanding of its molecular and cell biology. We also discuss parallel developments in the study of collectrin, a catalytically inactive homologue of ACE2 with critical functions in the pancreas and kidney.