Although paracellin-1 (PCLN-1) is known to have a crucial role in the control of Mg2+ reabsorption in the kidney, the molecular pathways involved in the regulation of PCLN-1 have not been clarified. We used FLAG-tagged PCLN-1 to investigate these pathways further, and found that PCLN-1 is phosphorylated at Ser217 by protein kinase A (PKA) under physiological conditions in Madin-Darby canine kidney (MDCK) cells. PCLN-1 expression decreased Na+ permeability, resulting in a decrease in the transepithelial electrical resistance (TER). By contrast, PCLN-1 enhanced transepithelial Mg2+ transport. PKA inhibitors, N-[2-(p-bromocinnamylamino)ethyl]-5-isoquinolinesulfonamide dihydrochloride (H-89) and myristoylated protein kinase A inhibitor 14-22 amide PKI, and an adenylate cyclase inhibitor, 2',5'-dideoxy adenosine (DDA), reduced the phosphoserine level of PCLN-1. The inhibitory effect of DDA was rescued by 8-bromoadenosine-3',5'-cyclic monophosphate (8-Br-cAMP). PKA and adenylate cyclase inhibitors decreased transepithelial Mg2+ transport and TER. Dephosphorylated PCLN-1 moved from detergent-insoluble to soluble fractions and was dissociated from ZO-1. A fusion protein of PCLN-1 with glutathione-S-transferase revealed that Ser217 was phosphorylated by PKA. Phosphorylated PCLN-1 was localized in the tight junction (TJ) along with ZO-1, whereas dephosphorylated PCLN-1 and the S217A mutant were translocated into the lysosome. The degradation of dephosphorylated PCLN-1 and S217A mutant was inhibited by chloroquine, a specific lysosome inhibitor. Thus, the PKA-dependent phosphorylation of Ser217 in PCLN-1 is essential for its localization in the TJ and transepithelial Mg2+ transport.