ALG-2 is a Ca(2+)-binding protein that belongs to the penta-EF-hand protein family and associates with several proteins, including annexin VII, annexin XI, and Alix/AIP1, in a Ca(2+)-dependent manner. The yeast two-hybrid system and a biotin-tagged ALG-2 overlay assay were carried out to characterize the interaction between ALG-2 and Alix. The region corresponding to amino acid residues 794 to 827 in the carboxy-terminal proline-rich region of Alix was sufficient to confer the ability to interact directly with ALG-2. This region includes four-tandem PxY repeats. Alanine substitutions indicated that seven proline residues in this region, four in the PxY repeats, and four tyrosine residues in the PxY repeats are crucial for the binding affinity with ALG-2. Endogenous ALG-2 was co-immunoprecipitated in the presence of Ca(2+) with FLAG-tagged Alix or FLAG-tagged Alix Delta EBS, a deletion mutant lacking the endophilin binding consensus sequence, but not with FLAG-tagged Alix Delta ABS, another mutant lacking the region comprising amino acids 798-841, from the lysates of HEK293 cells transfected with each FLAG-tagged protein expression construct. FLAG-tagged ALG-2 overexpressed in HEK293 cells was also co-immunoprecipitated with Alix in a Ca(2+)-dependent fashion, whereas FLAG-tagged ALG-2(E47A/E114A), a Ca(2+)-binding deficient mutant of ALG-2, was not detected in the immunoprecipitates of Alix even in the presence of Ca(2+). Fluorescent microscopic analyses using the carboxy-terminal half of Alix fused with green fluorescent protein (GFP-AlixCT) revealed that endogenous ALG-2 in HeLa cells exhibits a dot-like pattern overlapping with exogenously expressed GFP-AlixCT, and the distribution of GFP-AlixCT Delta ABS is observed diffusely in the cytoplasm. These results indicate the requirement of ABS in Alix for the efficient accumulation of AlixCT and raise the possibility that ALG-2 participates in membrane trafficking through a Ca(2+)-dependent interaction with Alix.