Purpose Squid processing by-product is a kind of industrial waste, which is usually treated as low-value filler of fertilizer or animal feed. Squid processing by-product hydrolysate was reported to have angiotensin-converting enzyme (ACE) inhibitory activity. The purpose of this study was to investigate ACE and renin inhibitory activity of fermentation products of squid processing by-product. Methods Active hydrolysate was prepared from squid processing by-product fermented by Bacillus natto, the process conditions were optimized by response surface analysis. Results The effects of various factors on ACE inhibition rate and polypeptide content were as follows: B (fermentation temperature) > C (inoculation amount) > D (liquid to solid ratio) > A (fermentation time). The optimal fermentation conditions were as follows: 37.5 h, 42.1 degrees C, 6% of inoculation, and 22.7:1 of liquid (fermentation broth) to solid (squid processing by-product powder) ratio. Under these conditions, the ACE inhibition rate and peptide content of fermentation broth were 82.22% and 208.18 mg/g, respectively. Subsequently, the broth was ultrafiltrated, and the filtrate (<1 kDa) was found to have best ACE and renin inhibition activities, reaching 86.50 +/- 1.84% and 81.09 +/- 1.23% at 1 mg/mL, respectively, compared with other filtrates of the broth; However, after simulated gastrointestinal digestion, these activities decreased to 48.24 +/- 1.18% and 49.37 +/- 1.16%, respectively. The half inhibition concentration (IC50) values of ACE and renin inhibition were determined as 1.01 +/- 0.08 mg/mL and 1.15 +/- 0.09 mg/mL, respectively. Conclusions Taken together, the present data suggest that the fermented squid processing by-product is a potential source of ACE and renin inhibitory compounds. [GRAPHICS] .