The kinetics of the thermolysin-catalyzed synthesis of N-(benzyloxycarbonyl)-L-phenylalanyl-L-leucine ethyl ester (Z-Phe-LeuOEt) from N-(benzyloxycarbonyl)-L-phyenylalanine (Z-Phe) and L-leucine ethyl ester (LeuOEt) in an ethyl acetate saturated aqueous system in a batch operation were studied. The kinetics for the synthesis of Z-Phe-LeuOEt were expressed using a rate equation for the rapid equilibrium random bireactant mechanism. The four kinetic constants involved in the rate equation were determined numerically by the quasi-Newton method so as to fit the calculated results with the experimental data. Within the pH and temperature range examined, the $K_{cat}$ value for the synthesis of Z-Phe-LeuOEt reached a maximum at pH 7.0 and $45^{circ}C$, whereas the affinity between Z-Phe and thermolysin reached a maximum at pH 6.0 adn $40^{circ}C$. The inhibitory effect of Z-Phe on the condensation reaction decreased as the pH and temperature decreased. In contrast, they affinity between LeuOEt and thermolysin remained unchanged within the pH and temperature range examined. Therefore, it was concluded that the protonation state of the carboxyl groups. of Z-Phe was more imprtant than that of the amono groups of LeuOEt for the synthesis of Z-Phe-LeuOEt in the present solvent system. The equilibrium yield at pH 6.0 and $30^{circ}C$ was 8% higher than that at pH 7.0 and $40^{circ}C$<TEX>, although the rate was much slower. This result suggested that the affinity between the enzyme and the substrate rather than the overall rate was a more important factor affecting the equilibrium yield, when the peptide synthesis was carried out in a product-precipitation system.