IN antigen-presenting cells, class II molecules of the major histocompatibility complex (MHC) bind peptides derived from endo-cytosed 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 MHC^3–5. 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 β-chain^6,7. 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.