Palladin is a novel component of stress fiber dense regions. Antisense and transient overexpression studies have indicated an important role for palladin in the regulation of actin cytoskeleton. Palladin colocalizes and coimmunoprecipitates with alpha-actinin, a dense region component, but the molecular details and functional significance of the interaction have not been studied. We show here a direct association between the two proteins and have mapped the binding site within a short sequence of palladin and in the carboxy-terminal calmodulin domain of alpha-actinin. Using transfection-based targeting assays, we show that palladin is involved in targeting of alpha-actinin to specific subcellular foci indicating a functional interplay between the two actin-associated proteins.