Two glucose-regulated proteins, GRP78 and GRP94, are major constituents of the endoplasmic reticulum (ER) of mammalian cells. These proteins are synthesized constitutively in detectable amounts under normal growth conditions; they can also be induced under a variety of conditions of stress including glucose starvation and treatment with drugs that inhibit cellular glycosylation, with calcium ionophores or with amino-acid analogues. Unlike the closely-related heat shock protein (HSP) family, the GRPs are not induced significantly by high temperature. Recently, GRP78 has been identified as the immunoglobulin heavy chain binding protein (BiP) (ref. 5 and Y.K. et al., in preparation) which binds transiently to a variety of nascent, wild-type secretory and transmembrane proteins and permanently to malfolded proteins that accumulate within the ER. We have tested the hypothesis that the presence of malfolded proteins may be the primary signal for induction of GRPs by expressing wild-type and mutant forms of influenza virus haemagglutinin (HA) in simian cells. Only malfolded HAs, whose transport from the ER is blocked, induced the synthesis of GRPs 78 and 94. Additional evidence is presented that malfolding per se, rather than abnormal glycosylation, is the proximal inducer of this family of stress proteins.