The V-shaped hair bundles atop auditory hair cells and their uniform orientation are manifestations of epithelial planar cell polarity (PCP) required for proper perception of sound. PCP is regulated at the tissue level by a conserved core Wnt/PCP pathway. However, the hair cell-intrinsic polarity machinery is poorly understood. Recent findings implicate hair cell microtubules in planar polarization of hair cells. To elucidate the microtubule-mediated polarity pathway, we analyzed Lis1 function in the auditory sensory epithelium in the mouse. We show that conditional deletion of Lis1 in developing hair cells causes defects in cytoplasmic dynein and microtubule organization, resulting in planar polarity defects without overt effects on the core PCP pathway. Lis1 ablation during embryonic development results in defects in hair bundle morphology and orientation, cellular organization and junctional nectin localization. We present evidence that Lis1 regulates localized Rac-PAK signaling in embryonic hair cells, probably through microtubule-associated Tiam1, a guanine nucleotide exchange factor for Rac. Lis1 ablation in postnatal hair cells significantly disrupts centrosome anchoring and the normal V-shape of hair bundles, accompanied by defects in the pericentriolar matrix and microtubule organization. Lis1 is also required for proper positioning of the Golgi complex and mitochondria as well as for hair cell survival. Together, our results demonstrate that Lis1 mediates the planar polarity of hair cells through regulation of microtubule organization downstream of the tissue polarity pathway.