The prion encephalopathies are characterized by accumulation in the brain of the abnormal form PrPsc of a normal host gene product PrPc. The mechanism and site of formation of PrPsc from PrPc are currently unknown. In this study, ME7 scrapie-infected mouse brain was used to show, both biochemically and by double-labelled immunogold electron microscopy, that proteinase K-resistant PrPsc is enriched in subcellular structures which contain the cation-independent mannose 6-phosphate receptor, ubiquitin-protein conjugates, beta-glucuronidase, and cathepsin B, termed late endosome-like organelles. The glycosylinositol phospholipid membrane-anchored PrPc will enter such compartment for normal degradation and the organelles may therefore act as chambers for the conversion of PrPc into infectious PrPsc in this murine model of scrapie.