CD4+ T cell clones specific for the HIV-1 envelope (env) protein are able to recognize not only uninfected APC that have taken up and processed exogenous env protein, but also virally infected cells expressing the env protein. We have evaluated the hypothesis that endocytosis of endogenously synthesized env protein from the plasma membrane of infected cells permits entry of the protein into the MHC class II-restricted Ag processing pathway. We show here that the env protein of HIV-1 is internalized at a surprisingly high rate through a mechanism that is dependent upon a tyrosine-containing motif located in the cytoplasmic domain of the gp41 subunit. Mutation of a critical cytoplasmic tyrosine residue or truncation of the C-terminal portion of the cytoplasmic domain resulted in forms of the env protein that did not undergo rapid internalization. However, by a variety of assays, these poorly internalized forms of the env protein were processed for class II-restricted Ag presentation as efficiently as wild-type env protein, indicating that internalization by this pathway is not essential for class II-restricted presentation. In addition, a secreted form of the env protein was presented efficiently by class II MHC under conditions that prevented re-uptake by endocytosis. Taken together, these results suggest that although rapid endocytosis from the cell surface is likely to be a major mechanism by which endogenously synthesized env protein is processed for association with class II MHC, an internal pathway may also be used.