Families bearing mutations in the presenilin 1 (PS1) gene develop Alzheimer's disease. Previous studies have shown that the Alzheimer-associated mutations in PS1 increase production of amyloid beta protein (Abeta1-42). We now show that PS1 also regulates phosphorylation of the microtubule-associated protein tau. PS1 directly binds tau and a tau kinase, glycogen synthase kinase 3beta (GSK-3beta). Deletion studies show that both tau and GSK-3beta bind to the same region of PS1, residues 250-298, whereas the binding domain on tau is the microtubule-binding repeat region. The ability of PS1 to bring tau and GSK-3beta into close proximity suggests that PS1 may regulate the interaction of tau with GSK-3beta. Mutations in PS1 that cause Alzheimer's disease increase the ability of PS1 to bind GSK-3beta and, correspondingly, increase its tau-directed kinase activity. We propose that the increased association of GSK-3beta with mutant PS1 leads to increased phosphorylation of tau.