Isolated rat liver parenchymal cells incubated in the presence of monensin exhibited a reduced uptake of 125I-asialofetuin (125I-AF). Binding studies indicated that the effect was due to a rapid reduction in the number of active surface receptors for the asialoglycoprotein. Monensin had no effect on receptor internalization, but apparently interrupted the recycling of receptors back to the cell surface. Monensin also inhibited the degradation of 125I-AF previously bound to the cells; this inhibition was probably not due to a direct effect on intralysosomal proteolysis, as no lysosomal accumulation of undegraded ligand could be demonstrated in subcellular fractionation studies by means of sucrose gradients. It is more likely that monensin inhibits transfer of the labelled ligand from endocytic vesicles to lysosomes, as indicated by the accumulation of radioactivity in the former and by the ability of monensin to prevent the normally observed time-dependent increase in the buoyant density of endocytic vesicles. Whereas the effect of monensin on binding and uptake of asialofetuin was reversible, the effect on asialofetuin degradation could not be reversed.