The putative hepatitis C virus core protein has a predicted molecular weight of about 22 kD and contains two carboxy (COOH)-terminal hydrophobic domains. The cleavages generating the hepatitis C virus structural proteins (core, E1 and E2) are catalyzed by host signal peptidases. In the present study, we investigated the processing and intracellular localization of the hepatitis C virus core protein expressed in mammalian cells. Expression vectors encoding the entire core protein or COOH-terminal deletion mutants under the control of SV40 regulatory sequences were transfected in COS cells. Immunofluorescent staining with either polyclonal immunoglobulin or monoclonal anti-core antibodies showed that fragments containing the COOH-terminal hydrophobic stretch were retained in the cytoplasm of transfected cells, whereas truncated core proteins deleted of 28 or more residues were located in the nucleus. Our results suggest that a putative nuclear targeting sequence is contained in the first 40 residues of the core protein.