Influenza virus neuraminidase (NA), unlike the majority of integral membrane proteins, does not contain a cleavable signal sequence. It contains an NH2-terminal hydrophobic domain that functions as an anchor. We have investigated the signal function for translocation of this NH2-terminal hydrophobic domain of NA by constructing chimeric cDNA clones in which the DNA coding for the first 40 NH2-terminal hydrophobic amino acids of NA was joined to the DNA coding for the signal-minus hemagglutinin (HA) of influenza virus. The chimeric HA (N4OH) containing the NH2 terminus of NA was expressed in CV1 cells by using a simian virus 40 late-expression vector. The chimeric HA is synthesized, translocated into the rough endoplasmic reticulum, and glycosylated, whereas HA lacking the signal sequence is present only in small amounts and is unglycosylated. These results clearly show that the NH2 terminus of NA, in addition to its anchor function, also provides the signal function in translocation. However, the acquisition of complex oligosaccharides and the transport of N4OH to the cell surface are greatly retarded. To determine if the presence of two anchor sequences, one provided by NA at the NH2 terminus and the other provided by HA at the COOH terminus of N4OH, was responsible for the slow transport, the NH2 terminus of NA was fused to an "anchorless" HA. The resulting chimeric HA (N4OH482) contains the hydrophobic domain of NA at the NH2 terminus but lacks the HA anchor at the COOH terminus. N4OH482 was synthesized and glycosylated; however, as with N4OH, the acquisition of complex oligosaccharides and the migration to the cell surface are greatly retarded. Immunofluorescence data also support that, compared to the native HA, only a small amount of chimeric HA proteins is transported to the cell surface. Thus, the hydrophobic NH2 terminus of NA, although capable of providing the signal function in translocation across the rough endoplasmic reticulum, interferes with the transport of the chimeric HA to the cell surface.