Group I Burkitt lymphoma (BL) lines retaining the original BL tumor cell phenotype are unable to present endogenously expressed antigens to HLA class I-restricted cytotoxic T cells (CTL) but can be recognized if the relevant HLA class I/peptide epitope complex is reconstituted at the cell surface by exogenous addition of synthetic target peptide. Endogenous antigen-processing function is restored in BL lines that have undergone Epstein-Barr virus (EBV)-induced drift in culture to the group III phenotype typically displayed by EBV-transformed lymphoblastoid cell lines (LCL) of normal B cell origin. We compared group I versus group III cells for their expression of proteasome components, transporter proteins and HLA-class I antigens, all of which are thought to be involved in the endogenous antigen processing pathway. By Western blot analysis, there were not consistent differences in the low molecular mass protein subunits of proteasomes (lmp)-2, lmp-7 and delta, although the mb-1 proteasome subunit was regularly present at higher levels in group I BL lines relative to group III lines or LCL. By contrast there were marked differences in the expression of peptide transporter-associated proteins (Tap), with down-regulation of Tap-1 and Tap-2 in 8/8 and 7/8 group I BL lines, respectively. Surface levels of HLA class I antigens were also consistently lower in group I cells; this was not associated with an intracellular accumulation of free HLA heavy chains, such as is seen in the Tap-deficient T2 processing-mutant line, but instead reflected a reduced rate of HLA class I synthesis in group I cells. Analysis of EBV gene transfectants of the B lymphoma lines BJAB and BL41 showed that the virus-encoded latent membrane protein-1 (LMP1), which is one of several EBV antigens expressed in group III but not in group I cells, was uniquely able to up-regulate expression both of the Tap proteins and HLA class I. Furthermore, this was accompanied by a restoration of antigen-processing function as measured by the ability of these cells to present an endogenously expressed viral antigen to CTL. These effects of LMP1 were similar to those induced in the same cell lines by interferon-gamma treatment. The results implicate both Tap and HLA class I expression as factors limiting the antigen-processing function of BL cells, and suggest that the accessibility of other EBV-associated malignancies to CTL surveillance may be critically dependent upon their LMP1 status.