The interactions between B cell CD40 and T cell CD40 ligand (CD40L) have been shown recently to play an important role in T cell-dependent activation of B cells. Here, we show that the ligation of CD40 stimulates the processing of antigen by B cells. The activation of an antigen-specific T cell hybrid by B cells co-cultured with insect cells expressing recombinant CD40L or with a CD40-specific monoclonal antibody requires less antigen and fewer B cells compared to control cells. The augmentation was observed both for processing initiated by antigen binding to and cross-linking the surface immunoglobulin, and processing of antigen taken up by fluid-phase pinocytosis. CD40 appears to affect a step in the intracellular processing of antigen, as CD40 has no effect on the presentation of an antigenic peptide which does not require processing. In addition, the CD40-induced augmentation of processing is not attributable to the effect of CD40 ligation on the cell surface expression of B7, LFA-1 or CD23. CD40 ligation does not affect the biosynthesis of the class II EK molecules, and although ligation of CD40 induces B cell proliferation, the augmentation of processing does not require proliferation. The ability of CD40 to stimulate B cell antigen processing has the potential to influence significantly the outcome of antigen-dependent T cell-B cell interactions.