IN antigen-presenting cells, class II molecules of the major histocompatibility complex (MHC) bind peptides derived from endocytosed proteins1. In certain B-lymphoblastoid cell mutants, MHC class II molecule-peptide complex formation is impaired, resulting in deficient antigen-presenting function2. MHC deletion mutants with this defect map the responsible gene(s) to the class II region of the MHC3-5. Here we report that multiple independent mutants with the class II presentation defect harbour lesions in HLA-DMB, an MHC-linked gene encoding a class II-like beta-chain6,7. Expression of DMB complementary DNA in mutants lacking DMB messenger RNA restores the wild-type phenotype. These results establish HLA-DM as a critical regulatory molecule in class II-restricted antigen presentation and suggest that it functions at an intracellular site to promote class II molecule-peptide association.