Within APCs, ubiquitination regulates the trafficking of immune modulators such as MHC class II and CD86 (B7.2) molecules. MARCH1 (membrane-associated RING-CH), a newly identified ubiquitin E3 ligase expressed in APCs, ubiquitinates MHC class II, thereby reducing its surface expression. Following LPS-induced maturation of dendritic cells, MARCH1 mRNA is down-regulated and MHC class II is redistributed to the cell surface from endosomal compartments. Here, we show that MARCH1 expression is also regulated at the posttranscriptional level. In primary dendritic cell and APC cell lines of murine origin, MARCH1 had a half-life of <30 min. MARCH1 degradation appears to occur partly in lysosomes, since inhibiting lysosomal activity stabilized MARCH1. Similar stabilization was observed when MARCH1-expressing cells were treated with cysteine protease inhibitors. Mutational analyses of MARCH1 defined discrete domains required for destabilization, proper localization, and functional interaction with substrates. Taken together, these data suggest that MARCH1 expression is regulated at a posttranscriptional level by trafficking within the endolysosomal pathway where MARCH1 is proteolyzed. The short half-life of MARCH1 permits very rapid changes in the levels of the protein in response to changes in the mRNA, resulting in efficient induction of Ag presentation once APCs receive maturational signals.