Localization of Toll-like receptors (TLR) in subcellular organelles is a major strategy to regulate innate immune responses. While TLR4, a cell-surface receptor, signals from both the plasma membrane and endosomal compartments, less is known about the functional role of endosomal trafficking upon TLR2 signaling. Here we show that the bacterial TLR2 ligands Pam3CSK4 and LTA activate NF-κB-dependent signaling from endosomal compartments in human monocytes and in a NF-κB sensitive reporter cell line, despite the expression of TLR2 at the cell surface. Further analyses indicate that TLR2-induced NF-κB activation is controlled by a clathrin/dynamin-dependent endocytosis mechanism, in which CD14 serves as an important upstream regulator. These findings establish that internalization of cell-surface TLR2 into endosomal compartments is required for NF-κB activation. These observations further demonstrate the need of endocytosis in the activation and regulation of TLR2-dependent signaling pathways.