Plasma membrane translocation of specific cytosolic proteins plays an important role in cell signaling pathways. We have recently shown that prohibitin (PHB) , a protein present in the plasma membranes of various cell types, interacts with Eps 15 homology domain protein 2 (EHD2), a lipid raft protein. However, the mechanism involved in membrane translocation of PHB is not known.We report that PHB undergoes palmitoylation at cysteine 69 (Cys69), and that this palmitoylation is required for PHB's membrane translocation. Furthermore, we demonstrate that membrane translocation of PHB facilitates tyrosine phosphorylation and its interaction with EHD2. Thus, the palmitoylation and membrane translocation of PHB and its interaction with EHD2 may play a role in cell signaling.