The human cytomegalovirus-encoded glycoprotein US2 catalyzes proteasomal degradation of Class I major histocompatibility complex (MHC) heavy chains (HCs) through dislocation of the latter from the endoplasmic reticulum (ER) to the cytosol. During this process, the Class I MHC HCs are deglycosylated by an N-glycanase-type activity. siRNA molecules designed to inhibit the expression of the light chain, beta(2)-microglobulin, block the dislocation of Class I MHC molecules, which implies that US2-dependent dislocation utilizes correctly folded Class I MHC molecules as a substrate. Here we demonstrate it is peptide: N-glycanase (PNGase or PNG1) that deglycosylates dislocated Class I MHC HCs. Reduction of PNGase activity by siRNA expression in US2-expressing cells inhibits deglycosylation of Class I MHC HC molecules. In PNGase siRNA-treated cells, glycosylated HCs appear in the cytosol, providing the first evidence for the presence of an intact N-linked type I membrane glycoprotein in the cytosol. N-glycanase activity is therefore not required for dislocation of glycosylated Class I MHC molecules from the ER.