Proteasomes are complex multisubunit proteases which play a critical role in intracellular proteolysis. Immunoproteasomes, which contain three gamma-interferon-inducible subunits, are a subset of proteasomes which have a specialized function in antigen processing for presentation by the MHC class I pathway. Two of the gamma-interferon inducible subunits, LMP2 and LMP7, are encoded within the MHC class II region adjacent to the two TAP (transporter associated with antigen presentation) genes. We have investigated the localization of immunoproteasomes using monoclonal antibodies to LMP2 and LMP7. Immunoproteasomes were strongly enriched around the endoplasmic reticulum as judged by double-immunofluorescence experiments with anti-calreticulin antibodies, but were also present in the nucleus and throughout the cytosol. In contrast, proteasome subunit C2, which is present in all proteasomes, was found to be evenly distributed throughout the cytoplasm and in the nucleus, as was the delta subunit, which is replaced by LMP2 in immunoproteasomes. gamma-Interferon increased the level of immunoproteasomes, but had no effect on their distribution. Our results provide the first direct evidence that immunoproteasomes are strongly enriched at the endoplasmic reticulum, where they may be located close to the TAP transporter to provide efficient transport of peptides into the lumen of the endoplasmic recticulum for association with MHC class I molecules.