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Hemocyanins (Hcs) and phenoloxidases (POs) are both members of the type-3 copper protein family, possessing di-cupric active sites which facilitate the binding of dioxygen. While Hcs and POs share a high degree of sequence homology, Hcs have been associated traditionally with oxygen transport whereas POs are catalytic proteins with a role in innate immunity. Evidence gathered in recent years details numerous immune functions for Hc, including an inducible PO activity. Unlike the pro-phenoloxidase activation cascade in arthropods, the endogenous mechanism(s) involved in the conversion of Hc into an immune enzyme is lacking in detail. The overall aim of this research was to characterise the physiological circumstances in which Hc is converted into a PO-like enzyme during immune challenge. A series of biochemical, biophysical and cellular techniques were used to assess the ability of phospholipid liposomes to mimic the well-characterised induction of PO activity in Hc by SDS micelles. Incubation of Hc purified from Limulus polyphemus, in the presence of phosphatidylserine (PS) liposomes, yielded ~ 90% of the PO activity observed upon incubation of Hc with the non-physiological activator, SDS. Phospholipid–induced PO activity in Hc was accompanied by secondary and tertiary structural changes similar to those observed in the presence of SDS. Subsequent analysis revealed that electrostatic interactions appear to be important in the PS-Hc activation complex. In vivo, PS-Hc interactions are assumed to be limited in quiescent cells. However, amebocytes undergoing apoptosis redistribute PS onto the outer leaflet of the plasma membrane, resulting in the potential for increased Hc-PS interactions. In the absence of a reliable culturing technique for L. polyphemus amebocytes, in vitro conditions were optimised for the short term maintenance of this labile cell type. Amebocytes retained viability and functionality in a medium that mimicked most-closely, the biochemical properties of L. polyphemus hemolymph. When presented with a fungal, bacterial or synthetic challenge, ~9% of amebocytes in vitro were found to be phagocytically active. Target internalisation was confirmed via the use of fluorescent quenchers and membrane probes. Within 4 hours of target internalisation, amebocytes underwent apoptosis, characterised by the loss of plasma and mitochondrial membrane potential, increased caspase-3 activity and extracellularisation of PS. Phagocytosis-induced cell death led to a proportional increase in the level of Hc-derived PO activity, suggesting that Hc may be interacting with PS present on terminal amebocyte membranes. The PO activity of Hc was investigated further in order to address an economically important issue; hyperpigmentation in commercial shellfish. While PO enzymes are thought to be the cause of hyperpigmentation in Nephrops norvegicus, evidence presented here suggests that cellular PO is inactivated after freeze-thawing, while extracellular Hc retains stability and displays a heightened level of inducible PO activity under similar treatments. Known PO inhibitors were used successfully to reduce Hc-derived PO activity, with inhibitors assumed to bind Hc in a manner similar to PO-inhibitor complexes. Structural and functional studies of hemocyanins and immune cells presented here provide new insights into the interactions of hemocyanin-activator complexes in invertebrates.