Immunization of BALB/c mice with human fetal cartilage proteoglycan (PG) produces progressive polyarthritis, and T cells play key roles in the development of the disease. To gain an understanding of how PG is presented to autoreactive T cells by synovial antigen-presenting cells (APC), we examined the abilities of various syngeneic APC in presenting PG to a specific T cell hybridoma 5/4E8, derived from a mouse with PG-induced arthritis. A20 B lymphoma cells and spleen cells were strong presenters of PG, but synoviocytes and P388D1 macrophages could only present PG effectively after stimulation with interferon-gamma (IFN-gamma). The IFN-gamma exerted its effect by up-regulating both MHC class II and intercellular adhesion molecule-1 (ICAM-1) expression by these cells as neutralizing antibodies to Ia, LFA-1 and ICAM-1 inhibited presentation. Our studies also showed that synoviocytes and spleen cells took up and processed PG more rapidly than the cell lines. Cysteine and serine protease-dependent antigen presentation of PG was blocked at 4 degrees C, 18 degrees C and by chloroquine treatment, indicating that presentation required active uptake and processing in an acidic compartment, probably in lysosomes. Also, keratan sulphate-depleted and cyanogen bromide (CNBr) and 2-nitro-5-thiocyanobenzoic acid (NTCB)-cleaved PG elicited stronger T cell responses, as they were more easily processed than the native molecule. Furthermore, CNBr-generated peptides were presented by fixed APC, indicating that core protein fragments of cartilage PG can be presented directly by APC in context with MHC class II molecules.