In addition to its ability to accelerate filament assembly, which is common to formins, INF2 is a formin protein with the unique biochemical ability to accelerate actin filament depolymerization. The depolymerization activity of INF2 requires its actin monomer-binding WASP homology 2 (WH2) motif. In this study, we show that INF2 is peripherally bound to the cytoplasmic face of the endoplasmic reticulum (ER) in Swiss 3T3 cells. Both endogenous INF2 and GFP-fusion constructs display ER localization. INF2 is post-translationally modified by a C-terminal farnesyl group, and this modification is required for ER interaction. However, farnesylation is not sufficient for ER association, and membrane extraction experiments suggest that ionic interactions are also important. The WH2 motif also serves as a diaphanous autoregulatory domain (DAD), which binds to the N-terminal diaphanous inhibitory domain (DID), with an apparent dissociation constant of 1.1 muM. Surprisingly, the DID-DAD interaction does not inhibit the actin nucleation activity of INF2; however, it does inhibit the depolymerization activity. Point mutations to the DAD/WH2 inhibit both the DID-DAD interaction and depolymerization activity. Expression of GFP-INF2 containing these DAD/WH2 mutations causes the ER to collapse around the nucleus, with accumulation of actin filaments around the collapsed ER. This study is the first to show the association of an actin-assembly factor with the ER.