Lis1 is required for nuclear migration in fungi, cell cycle progression in mammals, and the formation of a folded cerebral cortex in humans. Lis1 binds dynactin and the dynein motor complex, but the role of Lis1 in many dynein/dynactin-dependent processes is not clearly understood. Here we generate and/or characterize mutants for Drosophila Lis1 and a dynactin subunit, Glued, to investigate the role of Lis1/dynactin in mitotic checkpoint function. In addition, we develop an improved time-lapse video microscopy technique that allows live imaging of GFP-Lis1, GFP-Rod checkpoint protein, green fluorescent protein (GFP)-labeled chromosomes, or GFP-labeled mitotic spindle dynamics in neuroblasts within whole larval brain explants. Our mutant analyses show that Lis1/dynactin have at least two independent functions during mitosis: first promoting centrosome separation and bipolar spindle assembly during prophase/prometaphase, and subsequently generating interkinetochore tension and transporting checkpoint proteins off kinetochores during metaphase, thus promoting timely anaphase onset. Furthermore, we show that Lis1/dynactin/dynein physically associate and colocalize on centrosomes, spindle MTs, and kinetochores, and that regulation of Lis1/dynactin kinetochore localization in Drosophila differs from both Caenorhabditis elegans and mammals. We conclude that Lis1/dynactin act together to regulate multiple, independent functions in mitotic cells, including spindle formation and cell cycle checkpoint release.