Transferrin receptor 2 (TfR2) is a type 2 transmembrane protein expressed in hepatocytes that binds iron-bound transferrin (Tf). Mutations in TfR2 cause one form of hereditary hemochromatosis, a disease in which excessive absorption of dietary iron can lead to liver cirrhosis, diabetes, arthritis, and heart failure. The function of TfR2 in iron homeostasis is unknown. We have studied the regulation of TfR2 in HepG2 cells. Western blot analysis shows that TfR2 increases in a time- and dose-dependent manner after diferric Tf is added to the culture medium. In cells exposed to diferric Tf, the amount of TfR2 returns to control levels within 8 hours after the removal of diferric Tf from the medium. However, TfR2 does not increase when non-Tf-bound iron (FeNTA) or apo Tf is added to the medium. The response to diferric Tf appears to be hepatocyte specific. Real-time quantitative reverse transcription-polymerase chain reaction (qRT-PCR) analysis shows that TfR2 mRNA levels do not change in cells exposed to diferric Tf. Rather, the increase in TfR2 is attributed to an increase in the half-life of TfR2 protein in cells exposed to diferric Tf. Our results support a role for TfR2 in monitoring iron levels by sensing changes in the concentration of diferric Tf.