To isolate new peptide signal molecules involved in regulating developmental processes in hydra, a novel screening project was developed. Peptides extracted from the tissue of Hydra magnipapillata were systematically purified to homogeneity using HPLC. A fraction of each purified peptide was examined by differential display–PCR for its ability to affect gene expression in hydra. Another fraction was used to determine the tentative structure using an amino acid sequence analyzer and/or a mass spectrometer. Based on the results, peptides of potential interest were selected for chemical synthesis, followed by confirmation of the identity of the synthetic with the native peptides using HPLC. Using this approach, 286 peptides have been isolated, tentative amino acid sequences have been determined for 95 of them, and 19 synthetic peptides identical to native ones were produced. The 19 synthetic peptides were active in a variety of biological tests. For example, Hym-54 stimulated muscle contraction in adult polyps of hydra and sea anemone, Anthopleura fuscoviridis, and induced metamorphosis of planula, the larval stage, into polyps in a marine hydrozoan species, Hydractinia serrata. Another peptide, Hym-33H, inhibited nerve cell differentiation in hydra and induced tissue contraction in planula of Hydractinia serrata. The evidence obtained so far suggests that hydra contains a large number (>350) of peptide signal molecules involved in regulating developmental or other processes in cnidaria. These peptides can be isolated and their functions examined systematically with the new approach developed in this study.