The calcium-independent neural cell adhesion molecule N-CAM is expressed transiently during development in many tissues, including epithelia. The three naturally occurring principal isoforms of N-CAM differ in the way in which they associate with the membrane and in their cytoplasmic domains. These isoforms are generated by developmentally regulated alternative splicing of a single gene: the large cytoplasmic domain (ld) form (relative molecular mass 180,000 (Mr 180K] is specific for post-mitotic neurons; the 120K small cytoplasmic domain (ssd) and 140K small surface domain (sd) forms also occur on other cell types. One function of the different isoforms could be to specify cellular localization; for example, glycosyl phosphatidyl inositol (GPI)-membrane anchoring acts as a targeting signal for expression on the apical surface of polarized epithelial cells. Neurons and epithelial cells may use similar mechanisms for polarizing their plasma membrane proteins. We have therefore investigated the targeting of GPI-anchored (ssd N-CAM, 120K) and transmembrane forms of N-CAM (sd N-CAM, 140K; ld N-CAM, 180K) by comparing the expression of each after transfection of the appropriate complementary DNAs into polarized epithelial cells. We find that isoforms with alternative modes of membrane association are targeted to different surfaces of polarized epithelial cells: ssd N-CAM is expressed on the apical surface, whereas sd and ld N-CAM are expressed on the basolateral surface. These results suggest that the different isoforms of N-CAM determine their own diverse cellular destinations. They also support the hypothesis that the GPI anchor acts as an apical targeting signal in epithelia.