The glucocorticoid receptor (GR) is recovered from hormone-free cells in a heterocomplex with the molecular chaperone hsp90, which is required to produce the proper folding state for steroid binding. GR.hsp90 heterocomplexes are formed by a multiprotein system that appears to exist in all eukaryotic cells. Recently, we have reconstituted a receptor.hsp90 heterocomplex assembly system with purified rabbit hsp90 and hsp70 and bacterially expressed human p23 and p60. We have shown that hsp90, p60, and hsp70 form an hsp90.p60. hsp70 complex that converts the GR from a non-steroid binding to a steroid binding form (Dittmar, K. D., and Pratt, W. B. (1997) J. Biol. Chem. 272, 13047-13054). The resulting GR.hsp90 heterocomplex rapidly disassembles unless p23 is present to bind to the ATP-dependent conformation of hsp90 and stabilize its association with the receptor (Dittmar, K. D., Demady, D. R., Stancato, L. F., Krishna, P., and Pratt, W. B. (1997) J. Biol. Chem. 272, 21213-21220). In the current work, we show that the purified rabbit hsp70 utilized in prior studies is contaminated with a small amount of the rabbit DnaJ homolog hsp40. Elimination of the hsp40 from the purified GR.hsp90 assembly system reduces assembly activity, and the activity is restored by addition of the purified yeast DnaJ homolog YDJ-1. hsp40 is a component of the hsp90.p60.hsp70 foldosome complex isolated from reticulocyte lysate with antibody against p60. Under conditions that promote binding of p23 to hsp90 (elevated temperature, ATP, Nonidet P-40, molybdate), a five-membered (p23. hsp90.p60.hsp70.hsp40) complex of chaperone proteins is formed in reticulocyte lysate or from purified proteins. The hsp40-free, purified assembly system has a modest level of assembly activity that is maximally potentiated by YDJ-1 when it is present at about one-twentieth the concentration of hsp70. Although hsp40 is not in the final GR.hsp90 heterocomplex isolated from L cell cytosol, it is in the GR.hsp90 heterocomplex assembled in reticulocyte lysate. We conclude that hsp40 is a component of the multiprotein hsp90-based chaperone system where it potentiates GR.hsp90 heterocomplex assembly.