Mycobacterium tuberculosis (Mtb) are intracellular bacteria that persist in phagosomes of myeloid cells. Mtb-encoded factors support pathogen survival and reduce fusion of phagosomes with bactericidal lysosomal compartments. It is, however, not entirely understood if host-factors that mediate endosomal fusion affect Mtb intracellular localization and survival. Neither is it known if endosomal fusion influences induction of host immune reactivity by Mtb infected cells. Lysosomal degradation of Mtb appears pivotal for making available lipid substrates for assembly into lipid/CD1d complexes to allow activation of CD1d-restricted invariant (i)NKT cells. To clarify the role for endosomal fusion in Mtb survival and induction of host CD1d-mediated immune defense, we focused our studies on invariant chain (Ii). Ii regulates endosome docking and fusion and thereby controls endosomal transport. Through direct binding, Ii also directs intracellular transport of Class II MHC and CD1d. Our findings demonstrate that upon infection of Ii(-/-) macrophages, Mtb are initially retained in EEA1(+) LAMP1(-)phagosomes, which results in slightly impaired pathogen replication. The absence of Ii did not affect the ability of uninfected and infected macrophages to produce nitric oxide, TNF and IL-12. However, induction of cell surface CD1d was impaired in infected Ii(-/-) macrophages and CD1d-restricted iNKT cells were unable to suppress bacterial replication when cocultured with Mtb infected Ii(-/-) macrophages. Thus, while the host-factor Ii is not essential for the formation of the Mtb containing vacuole, its presence is crucial for iNKT cell recognition of infected macrophages.