Quantitative structure-activity relationship (QSAR) modelling was performed on peptides derived from milk proteins that inhibit angiotensin-I-converting enzyme (ACE). Physico-chemical descriptors expressed hydrophobicity, size and charge of side chains of the two most external amino acids in N- or C-terminal position. Models were estimated with partial least squares regression and validated with full cross-validation. A relationship (R=0.73, p<0.001) was found between hydrophobicity and positively charged amino acid in C-terminal position, size of amino acid next to C-terminal position and ACE-inhibition of peptides up to six amino acids in length. When longer peptides were included the relationship between C-terminal structure and activity decreased, reflecting the likely influence by steric effects. No relationship between N-terminal structure and inhibition activity was found. These biochemical interpretations were supported by findings from QSAR-modelling using so-called z-scales developed by Jonsson et al. (1989, Quant. Struct.-Act Relat. 8, 204–209) for amino acids.