It has recently been shown that hepatocyte growth factor activator inhibitor-2 (HAI-2) is able to suppress carcinogenesis induced by overexpression of matriptase, as well as cause regression of individual established tumors in a mouse model system. However, the role of HAI-2 is poorly understood. In this study, we describe 3 mutations in the binding loop of the HAI-2 Kunitz domain 1 (K42N, C47F and R48L) that cause a delay in the SEA domain cleavage of matriptase, leading to accumulation of non-SEA domain cleaved matriptase in the endoplasmic reticulum (ER). We suggest that, like other known SEA domains, the matriptase SEA domain auto-cleaves and reflects that correct oligomerization, maturation, and/or folding has been obtained. Our results suggest that the HAI-2 Kunitz domain 1 mutants influence the flux of matriptase to the plasma membrane by affecting the oligomerization, maturation and/or folding of matriptase, and as a result the SEA domain cleavage of matriptase. Two of the HAI-2 Kunitz domain 1 mutants investigated (C47F, R48L and C47F/R48L) also displayed a reduced ability to proteolytically silence matriptase. Hence, HAI-2 separately stabilizes matriptase, regulates the secretory transport, possibly via maturation/oligomerization and inhibits the proteolytic activity of matriptase in the ER, and possible throughout the secretory pathway.