Murine medullary thymic epithelial cells (mTEC), but not cortical thymic epithelial cells (cTEC), are able to present a soluble antigen, ovalbumin, to helper T cells (Mizuochi, T. et al., J. Exp. Med. 1992. 175: 1601–1605). This functional difference between the mTEC and the cTEC is particularly important when we consider the thymic selection of the T cell repertoire. In the previous report, we proposed that mTEC and cTEC utilize two distinct antigen processing/presenting pathways (Kasai, M. et al., Eur. J. Immunol. 1996. 26: 2101–2107). In this report, we further confirmed this difference by analyzing (a) localization of MHC class II, H2-DM, and invariant chain (Ii) molecules,(b) the biochemical nature of MHC class II molecules,(c) the sensitivity of MHC class II α β heterodimer formation to concanamycin A, a vacuolar H+-ATPase inhibitor, and (d) the subcellular distribution of MHC class II, H2-DM, and Ii molecules, in both TEC. Our results demonstrated that, in the mTEC, MHC class II, H2-DM and Ii molecules gain access to the endocytic pathway, where the luminal condition is acidic and thus Ii molecules are efficiently degraded and H2-DM molecules function well. In the cTEC, however, such molecules seemed to gain access to an alternative transport pathway, eg a secretory pathway, where the luminal condition is not fully acidic. These two distinct antigen processing pathways may account for the functional difference between mTEC and cTEC.