Middle East respiratory syndrome coronavirus (MERS-CoV) is associated with an outbreak of more than 90 cases of severe pneumonia with high mortality (greater than 50%). To date, there are no antiviral drugs or specific therapies to treat MERS-CoV. To rapidly identify potential inhibitors of MERS-CoV replication, we expressed the papain-like protease (PLpro) and the 3-chymotrypsin-like protease (3CLpro) from MERS-CoV and developed luciferase-based biosensors to monitor protease activity in cells. We show that the expressed MERS-CoV PLpro recognizes and processes the canonical CoV-PLpro cleavage site RLKGG in the biosensor. However, existing CoV PLpro inhibitors were unable to block MERS-CoV PLpro activity, likely due to the divergence of the amino acid sequence in the drug binding site. To investigate MERS-CoV 3CLpro activity, we expressed the protease in context with flanking nonstructural protein 4 (nsp4) and the amino-terminal portion of nsp6 and detected processing of the luciferase-based biosensors containing the canonical 3CLpro cleavage site VRLQS. Importantly, we found that a small-molecule inhibitor that blocks replication of severe acute respiratory syndrome (SARS) CoV and murine CoV also inhibits the activity of MERS-CoV 3CLpro. Overall, the protease expression and biosensor assays developed here allow for rapid evaluation of viral protease activity and the identification of protease inhibitors. These biosensor assays can now be used to screen for MERS-CoV-specific or broad-spectrum coronavirus PLpro and 3CLpro inhibitors.