An emerging paradigm in innate immune signalling is that cell biological context can influence the outcome of a ligand–receptor interaction. In this Review we discuss how Toll-like receptor (TLR) activation and signal transduction are regulated by subcellular compartmentalization of receptors and downstream signalling components. In particular, we focus on the functional specialization of TLRs in the endosomal system. We discuss recent studies that illustrate how basic aspects of the cellular machinery contribute to TLR function and regulation. This emerging area of research will provide important information on how immune signal transduction networks depend on (and in some cases influence) the generic regulators that organize eukaryotic cells.