Merlin, the neurofibromatosis 2 tumor suppressor protein, has two major isoforms with alternate C termini and is related to the ERM (ezrin, radixin, moesin) proteins. Regulation of the ERMs involves intramolecular and/or intermolecular head-to-tail associations between family members. We have determined whether merlin undergoes similar interactions, and our findings indicate that the C terminus of merlin isoform 1 is able to associate with its N-terminal domain in a head-to-tail fashion. However, the C terminus of isoform 2 lacks this property. Similarly, the N terminus of merlin can also associate with C terminus of moesin. We have also explored the effect of merlin self-association on binding to the regulatory cofactor of Na(+)-H(+) exchanger (NHE-RF), an interacting protein for merlin and the ERMs. Merlin isoform 2 captures more NHE-RF than merlin isoform 1 in affinity binding assays, suggesting that in full-length merlin isoform 1, the NHE-RF binding site is masked because of the self-interactions of merlin. Treatment with a phospholipid known to decrease self-association of ERMs enhances the binding of merlin isoform 1 to NHE-RF. Thus, although isoform 1 resembles the ERM proteins, which transition between inactive (closed) and active (open) states, isoform 2 is distinct, existing only in the active (open) state and presumably constitutively more available for interaction with other protein partners.