In the mammalian cytosol and nucleus the activity of the molecular chaperone Hsc70 is regulated by chaperone cofactors that modulate ATP binding and hydrolysis by Hsc70. Among such cofactors is the anti-apoptotic protein BAG-1. Remarkably, BAG-1 is expressed as multiple isoforms, which are distinguished by their amino termini. We investigated whether distinct isoforms differ with respect to their Hsc70-regulating activity. By comparing the mainly cytosolic isoforms BAG-1M and BAG-1S, opposite effects of the two isoforms were observed in chaperone-assisted folding reactions. Whereas BAG-1M was found to inhibit the Hsc70-mediated refolding of nonnative polypeptide substrates, the BAG-1S isoform stimulated Hsc70 chaperone activity. The opposite effects are not due to differences in the regulation of the ATPase activity of Hsc70 by the two isoforms. Both isoforms stimulated ATP hydrolysis by Hsc70 in an Hsp40-dependent manner through an acceleration of ADP-ATP exchange. Our results reveal that the different amino termini of the distinct BAG-1 isoforms determine the outcome of an Hsc70-mediated folding event, most likely by transiently interacting with the polypeptide substrate. Employing isoforms of a cofactor with different substrate binding properties appears to provide the means to influence the chaperone function of Hsc70 in addition to modulating its ATPase cycle.