Intracellular trafficking and cell surface expression of MHC class II molecules is a tightly regulated process and is to a large extent, determined by the fate of the class II chaperone, the invariant chain. Inhibition of endosomal proteases critical to invariant chain proteolysis reveals marked shunting of class II complexes to lysosomal compartments. Regulation of endosomal protease activity by expression of cystatin C directs class II cell surface expression during maturation of dendritic cells. These studies highlight the taut interactions between class-II–invariant-chain complexes and endosomal proteases during MHC class II maturation.