The family of membrane-associated guanylate kinases (MAGUK) comprises peripheral membrane proteins involved in the formation of specialized cell-cell junctions. MAGUK proteins possess a conserved domain composition, containing PDZ, guanylate kinase, and SH3 or WW domains. MAGI-1 is a recently identified member of the MAGUK protein family. Three splice variants of MAGI-1 have been characterized to date, including MAGI-1a, -1b, and -1c. MAGI-1b is predominantly associated with the crude membrane fraction. Here we show that the fifth PDZ domain of MAGI-1b is essential for membrane localization. We have also identified beta-catenin as a potential ligand for this PDZ domain. MAGI-1b forms complexes with beta-catenin and E-cadherin during the formation of cell-cell junctions in MDCK cells. In agreement with this observation, a significant portion of a GFP fusion of MAGI-1b localizes to the basolateral membrane of polarized MDCK cells.