Polypeptide hormones, growth factors, and other biologically significant molecules are specifically internalized by target cells. Exposure of cells to these ligands results in the formation of ligand-receptor complexes on the cell surface and subsequent internalization of these complexes into the endosomal apparatus (endosomes, or ENs). The study of ENs has identified several important functions for this unique cellular organelle. These include the dissociation of ligand from receptor and receptor recycling to the cell surface and the degradation of some internalized ligands, as well as the delivery of others to lysosomes. More recently, it has become apparent that ENs fulfill another critical role, that of signal transduction. In this article, we review the evidence substantiating this role for ENs and propose three models by which ENs participate in cell signaling.