The genome of the parasite Trypanosoma cruzi encodes two copies of autophagy-related cysteine proteases, Atg4.1 and Atg4.2. T. cruzi autophagin-2 (TcAtg4.2) carries the majority of proteolytic activity and is responsible for processing Atg8 proteins near the carboxyl terminus, exposing a conserved glycine. This enables progression of autophagy and differentiation of the parasite, which is required for successful colonization of humans. The mechanism of substrate hydrolysis by Atg4 was found to be highly conserved among the species as critical mutations in the TcAtg4.2, including mutation of the conserved Gly-244 residue in the hinge region enabling flexibility of the regulatory loop, and deletion of the regulatory loop, completely abolished processing capacity of the mutants. Using the positional scanning-substrate combinatorial library (PS-SCL) we determined that TcAtg4.2 tolerates a broad spectrum of amino acids in the P4 and P3 positions, similar to the human orthologue autophagin-1 (HsAtg4B). In contrast, both human and trypanosome Atg4 orthologues exhibited exclusive preference for aromatic amino acid residues in the P2 position, and for Gly in the P1 position, which is absolutely conserved in the natural Atg8 substrates. Using an extended P2 substrate library, which also included the unnatural amino acid cyclohexylalanine (Cha) derivative of Phe, we generated highly selective tetrapeptide substrates acetyl-Lys-Lys-Cha-Gly-AFC (Ac-KKChaG-AFC) and acetyl-Lys-Thr-Cha-Gly-AFC (Ac-KTChaG-AFC). Althoughthese substrates were cleaved by cathepsins, making them unsuitable for analysis of complex cellular systems, they were recognized exclusively by TcAtg4.2, but not by HsAtg4B nor by the structurally related human proteases SENP1, SENP2, and UCH-L3.