A network of peptidases governs proteostasis in plant chloroplasts and mitochondria. This study demonstrates strong genetic and functional interactions in Arabidopsis thaliana between the chloroplast stromal CLP chaperone-protease system and the PREP1,2 peptidases dually localized to chloroplast stroma and the mitochondrial matrix. Higher order mutants defective in CLP or PREP proteins were generated and analyzed by quantitative proteomics and N-terminal proteomics (TAILS). Strong synergistic interactions were observed between the CLP protease system (clpr1-2, clpr2-1, clpc1-1, clpt1, clpt2) and both PREP homologs (prep1, prep2) resulting in embryo lethality or growth and developmental phenotypes. Synergistic interactions were observed even when only one of the PREP proteins was lacking, suggesting that PREP1 and PREP2 have divergent substrates. Proteome phenotypes were driven by the loss of CLP protease capacity, with little impact by the PREP peptidases. Chloroplast N-terminal proteomes showed that many nuclear encoded chloroplast proteins have alternatively processed N-termini in prep1prep2, clpt1clpt2 and prep1prep2clpt1clpt2. Loss of chloroplast protease capacity interferes with stromal processing peptidase (SPP) activity due to folding stress and low levels of accumulated cleaved cTP fragments. PREP1,2 proteolysis of cleaved cTPs is complemented by unknown proteases. A model for CLP and PREP activity within a hierarchical chloroplast proteolysis network is proposed.