Inflammatory proteases (mast cell tryptase and trypsins) cleave protease-activated receptor 2 (PAR2) on spinal afferent neurons and cause persistent inflammation and hyperalgesia by unknown mechanisms. We determined whether transient receptor potential vanilloid receptor 1 (TRPV1), a cation channel activated by capsaicin, protons, and noxious heat, mediates PAR2-induced hyperalgesia. PAR2 was coexpressed with TRPV1 in small- to medium-diameter neurons of the dorsal root ganglia (DRG), as determined by immunofluorescence. PAR2 agonists increased intracellular [Ca2+] ([Ca2+]i) in these neurons in culture, and PAR2-responsive neurons also responded to the TRPV1 agonist capsaicin, confirming coexpression of PAR2 and TRPV1. PAR2 agonists potentiated capsaicin-induced increases in [Ca2+]i in TRPV1-transfected human embryonic kidney (HEK) cells and DRG neurons and potentiated capsaicin-induced currents in DRG neurons. Inhibitors of phospholipase C and protein kinase C (PKC) suppressed PAR2-induced sensitization of TRPV1-mediated changes in [Ca2+]i and TRPV1 currents. Activation of PAR2 or PKC induced phosphorylation of TRPV1 in HEK cells, suggesting a direct regulation of the channel. Intraplantar injection of a PAR2 agonist caused persistent thermal hyperalgesia that was prevented by antagonism or deletion of TRPV1. Coinjection of nonhyperalgesic doses of PAR2 agonist and capsaicin induced hyperalgesia that was inhibited by deletion of TRPV1 or antagonism of PKC. PAR2 activation also potentiated capsaicin-induced release of substance P and calcitonin gene-related peptide from superfused segments of the dorsal horn of the spinal cord, where they mediate hyperalgesia. We have identified a novel mechanism by which proteases that activate PAR2 sensitize TRPV1 through PKC. Antagonism of PAR2, TRPV1, or PKC may abrogate protease-induced thermal hyperalgesia.