In Saccharomyces cerevisiae, the metaphase-anaphase transition is initiated by the anaphase-promoting complex-dependent degradation of Pds1, whereby Esp1 is activated to promote sister chromatid separation. Although this is a fundamental step in the cell cycle, little is known about the regulation of Esp1 and how loss of cohesion is coordinated with movement of the anaphase spindle. Here, we show that Esp1 has a novel role in promoting anaphase spindle elongation. The localization of Esp1 to the spindle apparatus, analyzed by live cell imaging, is regulated in a manner consistent with a function during anaphase B. The protein accumulates in the nucleus in G2 and is mobilized onto the spindle pole bodies and spindle midzone at anaphase onset, where it persists into midanaphase. Association with Pds1 occurs during S phase and is required for efficient nuclear targeting of Esp1. Spindle association is not fully restored in pds1 mutants expressing an Esp1-nuclear localization sequence fusion protein, suggesting that Pds1 is also required to promote Esp1 spindle binding. In agreement, Pds1 interacts with the spindle at the metaphase-anaphase transition and a fraction remains at the spindle pole bodies and the spindle midzone in anaphase cells. Finally, mutational analysis reveals that the conserved COOH-terminal region of Esp1 is important for spindle interaction.