Transferrin receptor 2 (TfR2) is a homologue of transferrin receptor 1 (TfR1) but has distinct functions from TfR1 in iron homeostasis. In keeping with its proposed role in iron sensing, previous studies showed that TfR2 has a short half-life and that holo-Tf stabilizes TfR2 by redirecting it from a degradative pathway to a recycling pathway. In this study, we characterized how the endocytosis, recycling and degradation of TfR2 relates to its function and differs from TfR1. TfR2 endocytosis was adaptor protein-2 (AP-2) dependent. Flow cytometry analysis showed that TfR1 and TfR2 utilized the same endocytic pathway only in the presence of holo-Tf, indicating that holo-Tf alters the interaction of TfR2 with the endocytic machinery. Unlike TfR1, phosphofurin acidic cluster sorting protein 1 (PACS-1) binds to the cytoplasmic domain of TfR2 and data suggest that PACS-1 is involved in the TfR2 recycling. Depletion of TSG101 by siRNA or expression of a dominant negative Vps4 inhibited TfR2 degradation, indicating that TfR2 degradation occurs through a multivesicular body (MVB) pathway. TfR2 degradation is not mediated through ubiquitination on the single lysine (K31) in the cytoplasmic domain or on the amino terminal residue. No ubiquitination of TfR2 by HA-ubiquitin was detected, indicating a lack of direct TfR2 ubiquitination involvement in its degradation.