The present invention relates to a process for commercial production of octreotide using solution peptide chemistry and inexpensive amino acid derivatives. Thus the hexapeptide (Boc) D-Phe-Cys(Acm)-Phe-D-Trp-Lys(Boc)-Thr-OMe is synthesized by condensation of two tripeptide fragments, saponified and condensed with Cys(Acm)-Thr-OL to give the linear octapeptide alcohol. The linear peptide alcohol is treated with iodine, after removal of Boc groups, to give the cyclic peptide octreotide. The linear octapeptide alcohol can alternately be made by condensation of the protected hexapeptide acid with the dipeptide Cys(Acm)-Thr-OMe, followed by reduction with sodium borohydride.