The cytoplasmic domains of integrins are essential for cell adhesion. We report identification of a novel protein, ICAP-1 (integrin cytoplasmic domain- associated protein-1), which binds to the 1 integrin cytoplasmic domain. The interaction between ICAP-1 and beta1 integrins is highly specific, as demonstrated by the lack of interaction between ICAP-1 and the cytoplasmic domains of other beta integrins, and requires a conserved and functionally important NPXY sequence motif found in the COOH-terminal region of the beta1 integrin cytoplasmic domain. Mutational studies reveal that Asn and Tyr of the NPXY motif and a Val residue located NH2-terminal to this motif are critical for the ICAP-1 binding. Two isoforms of ICAP-1, a 200-amino acid protein (ICAP-1alpha) and a shorter 150-amino acid protein (ICAP-1beta), derived from alternatively spliced mRNA, are expressed in most cells. ICAP-1alpha is a phosphoprotein and the extent of its phosphorylation is regulated by the cell-matrix interaction. First, an enhancement of ICAP-1alpha phosphorylation is observed when cells were plated on fibronectin-coated but not on nonspecific poly-L-lysine-coated surface. Second, the expression of a constitutively activated RhoA protein that disrupts the cell-matrix interaction results in dephosphorylation of ICAP-1alpha. The regulation of ICAP-1alpha phosphorylation by the cell-matrix interaction suggests an important role of ICAP-1 during integrin-dependent cell adhesion.