Transition state analogs pepstatin methylester (PME) and L685458 have been shown to inhibit gamma-secretase non-competitively (Tian, G., Sobotka-Briner, C., Zysk, J., Liu, X., Birr, C., Sylvester, M. A., Edwards, P. D., Scott, C. W., and Greenberg, B. D. (2002) J. Biol. Chem. 277, 31499-31505). This unusual kinetics suggests physical separation of the sites for substrate binding and catalysis with binding of the transition state analogs to the catalytic site and not to the substrate binding site. Methods of inhibitor cross-competition kinetics and competition ligand binding were utilized to address whether non-transition state small molecule inhibitors, which also display non-competitive inhibition of gamma-secretase, inhibit the enzyme by binding to the catalytic site as well. Inhibitor cross-competition kinetics indicated competitive binding between the transition state analogs PME and L685458 and between small molecules arylsulfonamides and benzodiazepines, but non-competitive binding between the transition state analogs and the small molecule inhibitors. These results were indicative of two inhibitor binding sites, one for transition state analogs and the other for non-transition state small molecule inhibitors. The presence of two inhibitor binding sites for two different classes of inhibitors was corroborated by results from competition ligand binding using [3H]L685458 as the radioligand. Although L685458 and PME displaced the radioligand at the same concentrations as for enzyme inhibition, arylsulfonamides and benzodiazepines did not displace the radioligand at their Ki values, a result consistent with the presence of two inhibitor binding sites. These findings provide useful insights into the catalytic and regulatory mechanisms of gamma-secretase that may facilitate the design of novel gamma-secretase inhibitors.