The juxtamembrane region of the insulin receptor (IR) beta-subunit contains an unphosphorylated tyrosyl residue (Tyr960) that is essential for insulin-stimulated tyrosyl phosphorylation of some endogenous substrates and certain biological responses (White, M.F., Livingston, J.N., Backer, J.M., Lauris, V., Dull, T.J., Ullrich, A., and Kahn, C.R. (1988) Cell 54, 641-649). Tyrosyl residues in the juxtamembrane region of some plasma membrane receptors have been shown to be required for their internalization. In addition, a juxtamembrane tyrosine in the context of the sequence NPXY [corrected] is required for the coated pit-mediated internalization of the low density lipoprotein receptor. To examine the role of the juxtamembrane region of the insulin receptor during receptor-mediated endocytosis, we have studied the internalization of insulin by Chinese hamster ovary (CHO) cells expressing two mutant receptors: IRF960, in which Tyr960 has been substituted with phenylalanine, and IR delta 960, in which 12 amino acids (Ala954-Asp965), including the putative consensus sequence NPXY [corrected], were deleted. Although the in vivo autophosphorylation of IRF960 and IR delta 960 was similar to wild type, neither mutant could phosphorylate the endogenous substrate pp185. CHO/IRF960 cells internalized insulin normally whereas the intracellular accumulation of insulin by CHO/IR delta 960 cells was 20-30% of wild-type. However, insulin internalization in the CHO/IR delta 960 cells was consistently more rapid than that occurring in CHO cells expressing kinase-deficient receptors (CHO/IRA1018). The degradation of insulin was equally impaired in CHO/IR delta 960 and CHO/IRA1018 cells. These data show that the juxtamembrane region of the insulin receptor contains residues essential for insulin-stimulated internalization and suggest that the sequence NPXY [corrected] may play a general role in directing the internalization of cell surface receptors.