MutSbeta (MSH2-MSH3) mediates repair of insertion-deletion heterologies but also triggers triplet repeat expansions that cause neurological diseases. Like other DNA metabolic activities, MutSbeta interacts with proliferating cell nuclear antigen (PCNA) via a conserved motif (QXX(L/I)XXFF). We demonstrate that MutSbeta-PCNA complex formation occurs with an affinity of approximately 0.1 microM and a preferred stoichiometry of 1:1. However, up to 20% of complexes are multivalent under conditions where MutSbeta is in molar excess over PCNA. Conformational studies indicate that the two proteins associate in an end-to-end fashion in solution. Surprisingly, mutation of the PCNA-binding motif of MutSbeta not only abolishes PCNA binding, but unlike MutSalpha, also dramatically attenuates MutSbeta-MutLalpha interaction, MutLalpha endonuclease activation, and bidirectional mismatch repair. As predicted by these findings, PCNA competes with MutLalpha for binding to MutSbeta, an effect that is blocked by the cell cycle regulator p21(CIP1). We propose that MutSbeta-MutLalpha interaction is mediated in part by residues ((L/I)SRFF) embedded within the MSH3 PCNA-binding motif. To our knowledge this is the first case where residues important for PCNA binding also mediate interaction with a second protein. These findings also indicate that MutSbeta- and MutSalpha-initiated repair events differ in fundamental ways.