Two proteins that mediate bile acid export from the ileal enterocyte, organic solute transporter (OST)-alpha and -beta, have recently been identified. It is unclear whether these two proteins associate directly and how they interact to mediate transport function and membrane localization. In this study, the protein-protein interactions, transport functions, and membrane localization of human (h)OST-alpha and -beta proteins were examined. The results demonstrated that coexpression of hOST-alpha and -beta in transfected cells resulted in a three- to fivefold increase of the initial rate of taurocholate influx or efflux compared with cells expressing each protein individually and nontransfected cells. Confocal microscopy demonstrated plasma membrane colocalization of hOST-alpha and -beta proteins in cells cotransfected with hOST-alpha and -beta cDNAs. Protein-protein interactions between hOST-alpha and -beta were demonstrated by mammalian two-hybrid and coimmunoprecipitation analyses. Truncation of the amino-terminal 50 amino acid extracellular residues of hOST-alpha abolished its interaction with hOST-beta and led to an intracellular accumulation of the two proteins and to only background levels of taurocholate transport. In contrast, carboxyl-terminal 28 amino acid truncated hOST-alpha still interacted with hOST-beta, and majority of this cytoplasmic tail-truncated protein was expressed on the basolateral membrane when it was stably cotransfected with hOST-beta protein in Madin-Darby canine kidney cells. In summary, hOST-alpha and -beta proteins are physically associated. The intracellular carboxyl-terminal domain of hOST-alpha is not essential for this interaction with hOST-beta. The extracellular amino-terminal fragment of hOST-alpha may contain important information for the assembly of the heterodimer and trafficking to the plasma membrane.