Classical class I molecules assemble in the endoplasmic reticulum (ER) with peptides mostly generated from cytosolic proteins by the proteasome. The activity of the proteasome can be modulated by a variety of accessory protein complexes. A subset of the proteasome beta-subunits (LMP2, LMP7, and MECL-1) and one of the accessory complexes, PA28, are upregulated by gamma-interferon and affect the generation of peptides to promote more efficient antigen recognition. The peptides are translocated into the ER by the transporter associated with antigen processing (TAP). A transient complex containing a class I heavy chain-beta 2 microglobulin (beta 2 m) dimer is assembled onto the TAP molecule by successive interactions with the ER chaperones calnexin and calreticulin and a specialized molecule, tapasin. Peptide binding releases the class I-beta 2 m dimer for transport to the cell surface, while lack of binding results in proteasome-mediated degradation. The products of certain nonclassical MHC-linked class I genes bind peptides in a similar way. A homologous set of beta 2 m-associated membrane glycoproteins, the CD1 molecules, appears to bind lipid-based ligands within the endocytic pathway.