Caspase-7 is an executioner caspase that plays a key role in apoptosis, cancer, and a number of neurodegenerative diseases. The mechanism of caspase-7 activation by granzyme B and caspase-3 has been well characterized. However, whether other proteases such as calpains activate or inactivate caspase-7 is not known. Here, we present that recombinant caspase-7 is directly cleaved by calpain-1 within the large subunit of caspase-7 to produce two novel products, large subunit p18 and p17. This new form of caspase-7 has a 6-fold increase in V(max) when compared with the previously characterized p20/p12 form. Zymography revealed that the smaller caspase-7 product (p17) is 18-fold more active than either the caspase-3-cleaved product (p20) or the larger calpain-1 product of caspase-7 (p18). Mass spectrometry and site-directed mutagenesis identified the calpain cleavage sites within the caspase-7 large subunit at amino acid 36 and 45/47. These proteolysis events occur in vivo as indicated by the accumulation of caspase-7 p18 and p17 subunits in cortical neurons undergoing Ca(2+) dysregulation. Further, cleavage at amino acid 45/47 of caspase-7 by calpain results in a reduction in nuclear localization when compared with the caspase-3 cleavage product of caspase-7 (p20). Our studies suggest the calpain-activated form of caspase-7 has unique enzymatic activity, localization, and binding affinity when compared with the caspase-activated form.