EGF, but not TGFα, efficiently induces degradation of the EGF receptor (EGFR). We show that EGFR was initially polyubiquitinated to the same extent upon incubation with EGF and TGFα, whereas the ubiquitination was more sustained by incubation with EGF than with TGFα. Consistently, the ubiquitin ligase c-Cbl was recruited to the plasma membrane upon activation of the EGFR with EGF and TGFα, but localized to endosomes only upon activation with EGF. EGF remains bound to the EGFR upon endocytosis, whereas TGFα dissociates from the EGFR. Therefore, the sustained polyubiquitination is explained by EGF securing the kinase activity of endocytosed EGFR. Overexpression of the dominant negative N-Cbl inhibited ubiquitination of the EGFR and degradation of EGF and EGFR. This demonstrates that EGF-induced ubiquitination of the EGFR as such is important for lysosomal sorting. Both lysosomal and proteasomal inhibitors blocked degradation of EGF and EGFR, and proteasomal inhibitors inhibited translocation of activated EGFR from the outer limiting membrane to inner membranes of multivesicular bodies (MVBs). Therefore, lysosomal sorting of kinase active EGFR is regulated by proteasomal activity. Immuno-EM showed the localization of intact EGFR on internal membranes of MVBs. This demonstrates that the EGFR as such is not the proteasomal target.