Modification of AMPA receptor function is a major mechanism for the regulation of synaptic transmission and underlies several forms of synaptic plasticity. Post-translational palmitoylation is a reversible modification that regulates localization of many proteins. Here, we report that palmitoylation of the AMPA receptor regulates receptor trafficking. All AMPA receptor subunits are palmitoylated on two cysteine residues in their transmembrane domain (TMD) 2 and in their C-terminal region. Palmitoylation on TMD 2 is upregulated by the palmitoyl acyl transferase GODZ and leads to an accumulation of the receptor in the Golgi and a reduction of receptor surface expression. C-terminal palmitoylation decreases interaction of the AMPA receptor with the 4.1N protein and regulates AMPA- and NMDA-induced AMPA receptor internalization. Moreover, depalmitoylation of the receptor is regulated by activation of glutamate receptors. These data suggest that regulated palmitoylation of AMPA receptor subunits modulates receptor trafficking and may be important for synaptic plasticity.