Recently it was found that lactoferrin, an iron-binding glycoprotein with a molecular weight of 76,500, inhibits the remnant receptor-mediated uptake of apolipoprotein E (apoE)-bearing lipoproteins by the liver. In the present study we characterized the hepatic recognition of lactoferrin. Intravenously injected 125I-lactoferrin was cleared rapidly from the circulation by the liver (92.8 +/- 9.5% of the dose at 5 min after injection). Parenchymal cells contained 97.1 +/- 1.5% of the hepatic radioactivity. Internalization, monitored by measuring the release of liver-associated radioactivity by the polysaccharide fucoidin, occurred slowly. Only about 40% of the liver-associated lactoferrin was internalized at 10 min after injection, and it took 180 min to internalize 90%. Subcellular fractionation indicated that internalized lactoferrin is transported to the lysosomes. Binding of lactoferrin to isolated parenchymal liver cells was saturable with a dissociation constant of 10 microM (20 x 10(6) binding sites/cell). The role of arginine residues on lactoferrin was studied by modifying these residues with 1,2-cyclohexanedione. The modification resulted in a strongly reduced liver association (15.9 +/- 1.6% of the dose at 5 min after injection). Furthermore, unlabeled 1,2-cyclohexanedione-modified lactoferrin did not inhibit the binding of 125I-lactoferrin to isolated parenchymal cells. Arginine residues on lactoferrin thus appear to be essential for its specific recognition by parenchymal liver cells. In particular the clustered N-terminal arginine residues, which resemble the arginine-rich receptor binding sequence in apoE, may be responsible for both the interaction of lactoferrin with its recognition site and the inhibition of the hepatic uptake of apoE-bearing lipoproteins.