This study examined the effective utilization of pearl processing by-products. Three extracts of hot-water extract (WE), hydro-cooked extract (HE), and two-step enzymatic hydrolysate (EH) were prepared from pearl oyster muscle, and their characteristics were examined. The moisture, crude protein, volatile basic nitrogen (VBN), and amino-N contents were 97.5-98.0%, 0.5-1.3%, 2.1-4.9 g/100 mL, and 35.0-74.5 g/100 mL, respectively. EH had the lowest VBN and highest amino-N contents. In addition, EH had the highest yields. In terms of its functional properties, EH inhibited angiotensin-I converting enzyme ($IC_{50}$, 1.39 mg/mL) more strongly than the other extracts ($IC_{50}$, 4.17-7.95 mg/mL). The free amino acid contents of WE, HE, and EH were 661, 470 and 1,150 mg/100 mL, respectively. Major amino acids were taurine and glutamic acid. Major inorganic ions were Na, Mg, and Ca. Contents of taste compounds, such as free amino acids, inorganic ions, and quaternary ammonium bases, differed significantly according to the extract methods. Based on the results of chemical experiments and sensory evaluation, the quality of EH was superior to the other extracts, and EH is suitable for use in natural flavoring materials.