Extracellular vesicles (EVs) are nano-sized lipid vesicles released from cells into the extracellular milieu. We examined the yet unexplored role(s) of EVs in α-synuclein (α-syn) degradation and recipient-cell homeostasis, and whether EVs can affect the processing of extracellular α-syn species, thereby, their ability to transmit disease pathology. We found that EVs isolated from mouse brain carry active proteolytic enzymes that cleave both the α-syn monomer and pre-formed α-syn fibrils (PFFs) that transmit pathology when injected into mouse brain. We show that EV-mediated proteolysis reduced the ability of α-syn PFFs to seed the aggregation of α-syn monomer, monitored in vitro by thioflavin T assays, and its ability to seed the aggregation of endogenous α-syn in primary neuronal cell cultures. Interestingly, inhibition of the exosomal proteolytic activities by protease inhibitors accelerated the aggregation of α-syn. Proteomic profiling of the exosomal cargo identified a limited number of proteases of different specificities. Protease inhibitor profiling confirmed that exosomal cathepsins B and S are the enzymes responsible for the proteolytic processing of α-syn. We suggest that EVs represent a novel way to regulate the levels of extracellular α-syn and raise the possibility that mis-sorting of cellular proteases to EVs may be a novel post-translational mechanism involved in defective clearance of extracellular α-syn. For the first time, we show that brain EVs, enriched in exosomes possess α-syn degrading activities, and inhibition of these proteolytic activities promotes the aggregation of the protein. Importantly, cleavage of fibrillar α-syn by EV-associated proteases produces species with limited seeding capacity.