AP50, a component of clathrin coated pits, down modulates surface expression of CTLA4, a marker of T-cell activation. Internalization of CTLA4 by AP50 is decreased by phosphorylation of tyrosines on CTLA4. We used a yeast two-hybrid system to demonstrate that a cDNA of human AP50 complements the expression of the cytoplasmic domain of CD22 such that dually transfected yeast grow on histidine deficient medium. This argues for a direct interaction of AP50 with the cytoplasmic domain of CD22. Using a human cell line expressing a cDNA coding for wild-type murine CD22, we demonstrated that CD22 is internalized by the addition of anti-CD22 antibody. Internalization is abrogated by pretreating cells with pervanadate, the addition of which results in hyperphosphorylation of CD22. Moreover, pervanadate treatment alone results in increased surface expression of CD22. Cell lines expressing mutant CD22 constructs, either lacking the cytoplasmic domain, or with a Tyr to Phe change at either of two key tyrosine residues, exhibit decreased internalization of CD22 compared to wild-type, suggesting that AP50 binds to unphosphorylated tyrosine residues. A system to express myc-tagged AP50 in our CD22 positive cell line will be used to demonstrate the interaction of AP50 and CD22 in intact cells. Down modulation of CD22, an adhesin which binds to alpha-2,6 linked sialic acid, may be an important mechanism that enables activated B-cells to exit germinal centers. Decreased surface expression of CD22 may also remove an important negative regulator of signal transduction, allowing a lower threshold for B-cell activation.