To determine the mechanism and structural consequences of peptide binding to class I molecules, we have studied the L(d) molecule of the mouse. Previous studies have shown that a significant proportion of surface and intracellular L(d) molecules can be detected in an alternative conformation designated L(d)alt. L(d)alt molecules are non-ligand associated and show weak if any beta-2-microglobulin (beta-2M) association. We report here that L(d) molecules have a relatively rapid surface turnover compared with other class I molecules and that exogenous peptide dramatically prolongs L(d) surface half-life. By contrast, L(d)alt molecules are stably expressed on the surface and their half-life is unaffected by exogenous peptide. To study the surface interaction of peptide with L(d), live cells were incubated with iodinated peptides and L(d) molecules were precipitated from cells precoated with monoclonal antibody before lysis. Using this assay, peptide binding to surface L(d) molecules was found not to depend upon exchange with exogenous beta-2M, but did correlate with the level of beta-2m association. To study the intracellular interaction of peptide with L(d), Cell lysates were used. In cell lysates, peptide was found to convert L(d)alt molecules to properly folded L(d). This peptide-induced folding was almost complete at earlier but not later time points in pulse-chase analyses. Furthermore, conversion of L(d)alt to L(d) was found to affect almost exclusively immature (Endo H(s)) class I molecules. Thus intrinsic properties of immature L(d)alt molecules or their associated chaperonins are maintained in cell lysates that allow them to undergo de novo folding in vitro. These combined results demonstrate that immature L(d)alt molecules are precursors awaiting constituents such as peptide and beta-2M that influence folding, whereas surface L(d)alt molecules appear refractory to association with peptide, beta-2M, and consequent folding.