Intraluminal vesicles (ILVs) are small vesicles 50-80 nm in diameter formed during the maturation of early endosomes. A specialized endosome containing numerous ILVs is called a multivesicular body (MVB). ILVs contain internalized molecules such as antigens, nucleic acids, proteins, and metabolites. Some of these molecules are released from the MVBs inside exosomes and are transported to other cells. Other MVBs contain molecules that are retained in the ILVs and are later degraded within the cell.

MVBs were first observed in neuronal cells in 1955 using electron microscopy. MVBs have a diameter of 400-500 nm, are spherical, and were initially thought to be a form of the late endosome; however, recent studies have shown that MVBs are an intermediate form of these organelles between the early and the late endosomes.

ILV formation takes place when a ubiquitin-tagged protein enters the cell in an endocytic vesicle and fuses with the early endosome. As the early endosome matures, the endosomal membrane bends inwards to form ILVs. An ESCRT protein complex mediates ILV formation. Phosphatidylinositol 3-phosphate (PtdIns3P) is also required for ILV formation. PtdIns3P acts as a docking site for ESCRTs for the bending of the endosomal membrane.

The ESCRT complex and the ATPase, Vps4, required for ILV formation can be hijacked by enveloped retroviruses that infect host cells. Normally, ILVs are formed inside maturing endosomes with the help of ESCRTs within the cell, and the ubiquitin-tagged proteins are recognized and sorted into ILVs. In contrast, retroviruses use the ESCRTs to be released outside the cell. For example, the human immunodeficiency virus (HIV) codes for proteins, such as Gag, NC-p2, and Tat, that require ubiquitination for export. This ubiquitination is essential because ESCRTs and Vps4 recognize and sort only ubiquitin-tagged proteins into viral buds. Once the viral particles bud off from an infected cell, they are released into the extracellular space to infect other host cells.