Monkey cells persistently infected by measles virus (MV) Biken strain (Biken-CV-1 cells) showed no cytopathic effects and lacked surface expression of a homolog of human cell receptor, membrane cofactor protein CD46. Transfection of a human CD46 gene into these cells induced extensive cell fusion, indicating that down regulation of the endogenous CD46 homolog was essential for the maintenance of a noncytopathic mode of infection. Surface expression of the exogenously introduced human CD46 was also drastically down regulated in the persistently infected cells compared with uninfected cells. The down regulation was specific for CD46 and did not affect surface expression of exogenously introduced CD4. Exogenous human CD46 was synthesized efficiently in the persistently infected cells, but it did not accumulate on the cell surface. Fusion of Biken-CV-1 cells required the extracellular hemagglutinin (H-protein)-binding domain but not the cytoplasmic domain. Replacing the transmembrane and cytoplasmic domains of CD46 with a glycosylphosphatidylinositol anchor did not prevent cell fusion but completely alleviated down regulation of the glycosylphosphatidylinositol-anchored CD46 in Biken-CV-1 cells. Deletion analyses revealed that the membrane-distal sequences of the CD46 cytoplasmic domain were not only unnecessary but also inhibitory for CD46 down regulation. By contrast, the six amino acid residues proximal to the membrane contained a sequence required for CD46 down regulation in the persistently infected cells. These results indicate that CD46 is down regulated in the persistently infected cells by a mechanism that recognizes a membrane-proximal sequence in the CD46 cytoplasmic domain.