LGP85 is a lysosomal membrane protein possessing a type III topology and is also known as a member of the CD36 superfamily of proteins, such as CD36 and the scavenger-receptor BI (SR-BI). We have recently demonstrated that overexpression of LGP85 in various mammalian cell lines causes the enlargement of endosomal/lysosomal compartments (ELCs). Using chimeras and deletion mutants, we show here that the lumenal region of LGP85 is necessary, but not sufficient, for the development of ELCs. Effective formation of enlarged ELC was largely dependent on the presence of a preceding NH(2)-terminal transmembrane segment. Analyses of deletion mutants within the lumenal domain further revealed a requirement of the NH(2)-terminal transmembrane proximal lumenal region, with high sequence similarity with SR-BI for the enlargement of ELC. These results suggest that an interaction of the NH(2)-terminal transmembrane proximal lumenal domain of LGP85 with the inner leaflet of endosomal/lysosomal membranes through the connection with the transmembrane domain is an essential determinant for the regulation of endosomal/lysosomal membrane traffic. Interestingly, although the NH(2)-terminal transmembrane domain itself was not sufficient for the enlargement of ELCs, it appeared to be required for direct targeting of LGP85 from the trans-Golgi network to late endosomes/lysosomes. Taken together, these results indicate the involvement of distinct domain of LGP85 in the targeting to, and biogenesis and maintenance of, ELC.