The interaction of activated papain with low molecular weight cystatin (Mr 12500) purified from human placenta has been studied. Analysis of inhibition of caesinolytic activity of papain by cystatin showed stoichiometry of 1:1. Kinetic studies gave an inhibition constant (Ki) value of 5.5 x 10 -8 M and association rate constant (K+1) value of 3.4 x 10 4 (M-1 s-1). All spectroscopic studies showed conformational changes in both papain and cystatin on formation of complex. The data suggest perturbation of environment of aromatic residues and change of their native structure and conformation thereby shedding light on the behaviour of cystatins, especially interaction of placental cystatin with thiol protease inhibitors.