Has both folate hydrolase and N-acetylated-alpha-linked-acidic dipeptidase (NAALADase) activity. Has a preference for tri-alpha-glutamate peptides (By similarity). In the intestine, required for the uptake of folate. In the brain, modulates excitatory neurotransmission through the hydrolysis of the neuropeptide, N-aceylaspartylglutamate (NAAG), thereby releasing glutamate. Also exhibits a dipeptidyl-peptidase IV type activity. In vitro, cleaves Gly-Pro-AMC. Release of an unsubstituted, C-terminal glutamyl residue, typically from Ac-Asp-Glu or folylpoly-gamma-glutamates. Binds 2 Zn(2+) ions per subunit. Required for NAALADase activity. The NAALADase activity is inhibited by quisqualic acid, beta-NAAG and 2-(phosphonomethyl) pentanedioic acid (PMPA). Ethanol ingestion decreases the folate hydrolase activity by 50%. Optimum pH is 6.0. Homodimer. High expression in the duodenum and in the jejunum brush-border membrane. Weak expression in kidney. The NAALADase activity is found in the central region, the dipeptidyl peptidase IV type activity in the C-terminal. Belongs to the peptidase M28 family. M28B subfamily.