Protein antigens internalized by an antigen presenting cell are degraded into peptides, a subset of which binds to the class II glycoproteins encoded by the major histocompatibility complex to form epitopes recognized by specific T cells. Current evidence suggests that the immunogenic peptides are generated in an endosomal, acidic compartment containing internalized antigen, proteinases, and exocytic class II molecules. These exocytic class II glycoproteins are associated during transport from the endoplasmic reticulum to the endosomal compartment with an additional glycoprotein, the invariant chain. Proteolytic degradation of the invariant chain in the endosomal compartment dissociates it from the class II glycoproteins, which only then acquire the capacity to bind peptides. After peptide binding occurs, the class II-peptide complexes are transported to the antigen-presenting cell surface for recognition by T cells.