The PSD95/Dlg/ZO-1 (PDZ) domain-containing protein zonula occludens-1 (ZO-1) selectively localizes to the cytoplasmic basis of the slit diaphragm, a specialized cell-cell contact in between glomerular podocytes necessary to prevent the loss of protein in the urine. However, the function of ZO-1 at the slit diaphragm has remained elusive. Deletion of Neph1, a slit diaphragm protein of the immunoglobulin superfamily with a cytoplasmic PDZ binding site, causes proteinuria in mice. We demonstrate now that Neph1 binds ZO-1. This interaction was mediated by the first PDZ domain of ZO-1 and involved the conserved PDZ domain binding motif present in the carboxyl terminus of the three known Neph family members. Furthermore, Neph1 co-immunoprecipitates with ZO-1 from lysates of mouse kidneys, demonstrating that this interaction occurs in vivo. Both deletion of the PDZ binding motif of Neph1 as well as threonine-to-glutamate mutation of the threonine within the binding motif abrogated binding of ZO-1, suggesting that phosphorylation may regulate this interaction. ZO-1 binding was associated with a strong increase in tyrosine phosphorylation of the cytoplasmic tail of Neph1 and dramatically accelerated the ability of Neph1 to induce signal transduction. Thus, our data suggest that ZO-1 may organize Neph proteins and recruit signal transduction components to the slit diaphragm of podocytes.