The neurofibromatosis type 2 gene (NF2) is involved in the pathogenesis of benign tumors of the human nervous system. The NF2 protein, called schwannomin or merlin, is inactivated in virtually all schwannomas and meningiomas. The molecular mechanisms by which schwannomin functions as a tumor suppressor is unknown but believed to involve plasma membrane-cytoskeletal interactions. Two major alternatively spliced isoforms of schwannomin differing in their C termini have been reported. Using the yeast two-hybrid system, we have identified syntenin as a binding partner for schwannomin isoform-1 (sch-1). Syntenin is an adapter protein that couples transmembrane proteoglycans to cytoskeletal components and is involved in intracellular vesicle transport. The C terminus 25 amino acids of sch-1 and the two PDZ domains of syntenin mediate their binding, and mutations introduced within the VAFFEEL region of sch-1 defined a sequence crucial for syntenin recognition. We have showed that the two proteins interacted in vitro and in vivo and localized underneath the plasma membrane. Fibroblast cells expressing heterologous antisense syntenin display alterations in the subcellular distribution of sch-1. Together, these results provide the first functional clue to the existence of schwannomin isoforms and could unravel novel pathways for the transport and subcellular localization of schwannomin in vivo.