The collagens of the extracellular matrix are the most abundant structural proteins in the mammalian body. In tissue remodeling and in the invasive growth of malignant tumors, collagens constitute an important barrier, and consequently, the turnover of collagen is a rate-limiting process in these events. A recently discovered turnover route with importance for tumor growth involves intracellular collagen degradation and is governed by the collagen receptor, urokinase plasminogen activator receptor-associated protein (uPARAP or Endo180). The interplay between this mechanism and extracellular collagenolysis is not known. In this report, we demonstrate the existence of a new, composite collagen breakdown pathway. Thus, fibroblast-mediated collagen degradation proceeds preferentially as a sequential mechanism in which extracellular collagenolysis is followed by uPARAP/Endo180-mediated endocytosis of large collagen fragments. First, we show that collagen that has been pre-cleaved by a mammalian collagenase is taken up much more efficiently than intact, native collagen by uPARAP/Endo180-positive cells. Second, we demonstrate that this preference is governed by the acquisition of a gelatin-like structure by the collagen, occurring upon collagenase-mediated cleavage under native conditions. Third, we demonstrate that the growth of uPARAP/Endo180-deficient fibroblasts on a native collagen matrix leads to substantial extracellular accumulation of well defined collagen fragments, whereas, wild-type fibroblasts possess the ability to direct an organized and complete degradation sequence comprising both the initial cleavage, the endocytic uptake, and the intracellular breakdown of collagen.