PROGRESSIVE cerebral deposition of the amyloid β-peptide is an early and invariant feature of Alzheimer's disease. The β-peptide is released by proteolytic cleavages from the β-amyloid precursor protein (βAPP)¹, a membrane-spanning glycoprotein expressed in most mammalian cells. Normal secretion of βAPP involves a cleavage in the β-peptide region2-3, releasing the soluble extramembranous portion^4,5 and retaining a 10K C-terminal fragment in the membrane⁶. Because this secretory pathway precludes β-amyloid formation, we searched for an alternative proteolytic processing pathway that can generate β-peptide-bearing fragments from full-length β APP. Incubation of living human endothelial cells with a βAPP antibody revealed reinternalization of mature βAPP from the cell surface and its targeting to endosomes/lysosomes. After cell-surface biotinylation, full-length biotinylated βAPP was recovered inside the cells. Purification of lysosomes directly demonstrated the presence of mature βAPP and an extensive array of β-peptide-containing proteolytic products. Our results define a second processing pathway for βAPP and suggest that it may be responsible for generating amyloid-bearing fragments in Alzheimer's disease.