The metabolic fate of LH/hCG receptors after exposure to human chorionic gonadotropin (hCG) was examined in cultured rat luteal cells and murine Leydig tumour cells (MLTC-1). Kinetic studies performed after pulse-labelling of the cells with [125I]hCG indicated that the bound hormone was lost much more rapidly from the tumour cells than from the luteal cells (t1/2 = 4.5 and greater than 12 h, respectively). The tumour cells were also found to internalise and degrade the hormone more effectively than the luteal cells, as measured by disappearance of acid-releasable (i.e. surface-bound) radioactivity from the cells and by the appearance of trichloroacetic acid (TCA)-soluble label in the medium. In MLTC-1 cells, over 80% of the radioactivity released was TCA-soluble at all times examined, whereas in the luteal cells most (65-75%) was TCA-precipitable. Chemical cross-linking and analyses by SDS-PAGE of this material revealed that both cell types also released, in addition to intact hCG, two previously characterized receptor fragment-[125I]hCG complexes (Mr 96,000 and 74,000) (Kellokumpu & Rajaniemi, Endocrinology 116 (1985) 707) into the medium, although their amount was negligible in MLTC-1 cells. Possibly, due to rapid discharge of the ligand from its receptor, no similar complexes could be detected inside the MLTC-1 cells, suggesting that they were released directly from the cell surface. However, the Mr 74,000 complex was observed inside MLTC-1 cells if chloroquine, a lysosomotropic agent, was present during the incubations. This suggests that the internalised receptor also becomes degraded, at least when complexed to hCG. The results thus provide evidence that there exist two different mechanisms for proteolytic processing of LH/hCG receptors in these target cells. In tumour cells, the degradation seems to occur almost exclusively intracellularly, whereas in luteal cells a substantial portion of the receptors is also degraded at the cell surface.