HFE is a MHC class 1-like protein that is mutated in hereditary hemochromatosis. In order to elucidate the role of HFE protein on cellular iron metabolism, functional studies were carried out in human hepatoma cells (HLF) overexpressing a fusion gene of HFE and green fluorescent protein (GFP). The expression of HFE-GFP was found to be localized on cell membrane and perinuclear compartment by fluorescent microscopy. By co-immunoprecipitation and Western blotting, HFE-GFP protein formed a complex with endogenous transferrin receptor and beta(2)-microglobulin, suggesting that this fusion protein has the function of HFE reported previously. We then examined the (59)Fe uptake and release, and internalization and recycling of (125)I-labeled transferrin in order to elucidate the functional roles of HFE in the cell system. In the transfectants, HFE protein decreased the rate of transferrin receptor-dependent iron ((59)Fe) uptake by the cells, but did not change the rate of iron release, indicating that HFE protein decreased the rate of iron influx. Scatchard analysis of transferrin binding to HFE-transfected cells showed an elevation of the dissociation constant from 1.9 to 4. 3 nM transferrin, indicating that HFE protein decreased the affinity of transferrin receptor for transferrin, while the number of transferrin receptors decreased from 1.5x10(5)/cell to 1. 2x10(5)/cell. In addition, the rate of transferrin recycling, especially return from endosome to surface, was decreased in the HFE-transfected cells by pulse-chase study with (125)I-labeled transferrin. Our results strongly suggest an additional role of HFE on transferrin receptor recycling in addition to the decrease of receptor affinity, resulting in the reduced cellular iron.