Limited axon regeneration following peripheral nerve injury may be related to activation of the lysosomal protease, asparaginyl endopeptidase (AEP, δ-secretase), and its degradation of the microtubule associated protein, Tau. Activity of AEP was increased at the site of sciatic nerve transection and repair but blocked in mice treated systemically with a specific AEP inhibitor, compound 11 (CP11). Treatments with CP11 enhanced axon regeneration in vivo. Amplitudes of compound muscle action potentials recorded four weeks after nerve transection and repair and two weeks after daily treatments with CP11 were double those of vehicle-treated mice. At that time after injury, axons of significantly more motor and sensory neurons had regenerated successfully and reinnervated the tibialis anterior and gastrocnemius muscles in CP11-treated mice than vehicle-treated controls. In cultured adult dorsal root ganglion neurons derived from wild type mice that were treated in vitro for 24 hours with CP11, neurites were nearly 50% longer than in vehicle-treated controls, and similar to neurite lengths in cultures treated with the TrkB agonist, 7,8-dihydroxyflavone (7,8-DHF). Combined treatment with CP11 and 7,8-DHF did not enhance outgrowth more than treatments with either one alone. Enhanced neurite outgrowth produced by CP11 was found also in the presence of the TrkB inhibitor, ANA-12, indicating that the enhancement was independent of TrkB signaling. Longer neurites were found after CP11 treatment in both TrkB+ and TrkB- neurons. Delta secretase inhibition by CP11 is a treatment for peripheral nerve injury with great potential.