The kinetics of the transferrin-reticulocyte interaction was studied using free and colloidal gold-conjugated double labelled transferrin (Tf and AuTf, respectively). Simultaneous biochemical and morphological experiments provided the following information: 1. The cellular recycling of Tf is significantly faster than that of AuTf. 2. AuTf induces a marked increase in the number of multivesicular elements (MVE) in rabbit reticulocytes. 3. The release of AuTf from the cells is very slow and accumulation of gold particles in MVEs can be observed during the process. The results suggest that the two postulated pathways of the transferrin-cell cycle (a fast, iron-donating and a slow, receptor-shedding cycle) are not similarly involved in the cellular processing of Tf and AuTf. While it has been suggested that in the Tf-cell interaction the fast recycling mechanism is dominating, it is likely that, probably due to steric effects, the majority of AuTfs are forced into the slower receptor-shedding pathway. These observations call attention to the possible limitations of the colloidal gold labelling technique in the determination of the kinetics and pathway of intracellular processing of free ligands.