We previously reported that the responsiveness of hepatocytes to thyroid hormone is markedly attenuated when they were cultured as monolayers rather than spheroids. To elucidate the mechanisms underlying the altered responsiveness, thyroid hormone receptor auxiliary proteins in the hepatocytes were analyzed by electrophoretic mobility shift assay. The major thyroid hormone receptor auxiliary protein was identified as 9-cis-retinoic acid receptor alpha (RXRalpha) in the hepatocytes regardless of the culture conditions. The cytoplasmic fraction was shown to contain a protease(s) that cleaves RXRalpha at its amino terminus. The presence of the protease in the cytosol, but not in the nucleus, was ascertained by incubating full-length 35S-labeled RXRalpha with each fraction. Using various protease inhibitors, it was shown that cathepsin L-type protease could participate in the cleavage of the RXRalpha. The enzyme activity was much higher in the monolayers than the spheroids. Inhibition of this enzyme activity in the monolayer hepatocyte resulted in the increase of nuclear RXRalpha protein and the augmentation of T3-dependent induction of spot 14 mRNA. These results suggest that the changes in cathepsin L-type protease activity in the cytosol may alter the turnover of RXRalpha in the nucleus and modify the function of steroid receptor superfamilies that heterodimerize with RXRalpha.