PEGylation of peptides and proteins has been widely used to enhance stability and reduce immunogenicity of biotherapeutics. Characterizing the degradation of these PEGylated products in biological fluids can yield essential information to support pharmacokinetic evaluations and provide clues about their in vivo properties useful for further molecular optimization. In this paper, we describe a novel and uncomplicated approach to characterize PEGylated peptides or proteins and their related degradation products in biological matrixes. The method involves direct liquid chromatography/mass spectrometry (LC/MS) analysis of animal sera containing low nanograms to low micrograms per milliliter of PEGylated product with or without an acetonitrile precipitation sample treatment. Applying the methodology to analyze the model PEGylated peptides, 20K PEGylated-Pancreatic Polypeptide analogue (PPA) and 20K PEGylated-glucagon, we elucidated the decomposition pathways occurring in animal sera. The data provided direct evidence of cleavages within the peptide backbone. The identified degradation products were unambiguously confirmed by tandem mass spectrometry with high-energy C-trap dissociation (HCD) analysis, followed with in-source fragmentation. Additional spiking studies demonstrated nearly full recovery of PEGylated products, linear detection when the spiked concentration of PEGylated product was ≤1000 ng/mL, and a low ng/mL limit of quantitation (LOQ).