The mechanism of cell entry and intracellular fate of a gene transfer vector composed of a receptor-targeting, DNA-condensing peptide, RGD-oligolysine, a luciferase encoding plasmid DNA (pDNA) and a cationic liposome was examined. We demonstrate by confocal microscopy, electron microscopy and subcellular fractionation that the major mechanism of entry of the vector is endocytic. The vector complex rapidly (5 min) internalizes into early endosomes, then late endosomes and lysosomes. Entry involves, at least in part, clathrin-coated pit-mediated endocytosis since different conditions or drugs known to influence this pathway modify both uptake of pDNA and its expression. The observed increase in expression with addition of a lip some correlated with an increase in the rate of transfer of the pDNA to lysosomes, a decrease in intracellular recycling and exocytosis of the pDNA and an increase in the amount of pDNA in the nuclear fraction. Trafficking within the cell involved endosome fusion and the acid environment of the endosomes-lysosomes was beneficial for expression. After 30 min both the peptide and pDNA localized to the nucleus and the amount of intact pDNA in the nuclear fraction was highest with liposome and peptide. A better understanding of the cellular mechanisms by which vectors transfer to and traffic in cells should help design improved vectors.