gamma-Interferon-inducible lysosomal thiol reductase (GILT) is constitutively expressed in antigen-presenting cells. GILT facilitates unfolding of endocytosed antigens in MHC class II-containing compartments by enzymatically reducing disulfide bonds. The enzyme is synthesized as a 35-kDa precursor. Although a fraction of the precursor is secreted as a disulfide-linked dimer, the majority is directed via the mannose-6-phosphate receptor pathway to endocytic compartments where its N- and C-terminal propeptides are cleaved to generate the 30-kDa mature form. Both precursor and mature GILT reduce disulfide bonds with an acidic pH optimum. In this report, we show that the cysteine residues in the C-terminal propeptide, Cys-211 and Cys-222, serve key structural roles. Mutation of Cys-222 abolishes disulfide-linked dimerization of precursor GILT and decreases the efficiency of GILT maturation. Mutation of Cys-211 results in both impaired intracellular maturation and loss of enzymatic activity of the precursor form at an acidic pH. A similar phenotype was obtained upon mutation of Cys-200, which is retained in the mature form. Cys-200 and Cys-211 seem to form a disulfide bond that links the propeptide and the mature enzyme until reduction in the lysosome. This disulfide bridge is essential for stability of the enzyme at low pH and for its proper maturation in vivo.