Hepcidin is a peptide hormone secreted by the liver in response to iron loading and inflammation. Decreased hepcidin leads to tissue iron overload, whereas hepcidin overproduction leads to hypoferremia and the anemia of inflammation. Ferroportin is an iron exporter present on the surface of absorptive enterocytes, macrophages, hepatocytes, and placental cells. Here we report that hepcidin bound to ferroportin in tissue culture cells. After binding, ferroportin was internalized and degraded, leading to decreased export of cellular iron. The posttranslational regulation of ferroportin by hepcidin may thus complete a homeostatic loop: Iron regulates the secretion of hepcidin, which in turn controls the concentration of ferroportin on the cell surface.