Merlin (moesin-ezrin-radixin like protein), the product of neurofibromatosis type 2 gene, was primarily recognized as a tumor suppressor, but it also functions as a membrane-cytoskeletal linker and regulator of multiple signaling pathways. The activity and localization of merlin is regulated by head to tail folding that is controlled by phosphorylation of the Ser518 side chain. Merlin localizes in the nucleus when the Ser518 side chain is not phosphorylated, while the phosphorylated form is present in the cytoplasm and the plasma membrane. In this work interactions and their impact on the subcellular localization and phosphorylation state of the Ser518 side chain of merlin were investigated in endothelial cells. It is shown that merlin (dephospho-Ser518 form) interacts in the nucleus of endothelial cells with the scaffolding protein EBP50, a member of the Na+/H+exchanger regulatory factor family. Upon EBP50 depletion, merlin translocated from the nucleus, suggesting that binding of merlin to EBP50 is critical in the nuclear localization of merlin. Along with the translocation, the phosphorylation level of phospho-Ser518-merlin was increased in EBP50 depleted cells. TIMAP (TGFβ-inhibited membrane-associated protein), a type 1 protein phosphatase (PP1) regulatory subunit, was newly recognized as an interacting partner for merlin. Domain mapping using truncated mutant forms in GST pull down revealed that the N-terminal half of TIMAP (aa 1-290) and the FERM domain of merlin are the regions responsible for the interaction.The catalytic subunit of PP1 (PP1c) was present in all merlin-TIMAP pull down or immunoprecipitation samples demonstrating that merlin actually interacts with the PP1c-TIMAP holoenzyme. On the other hand, from TIMAP depleted cells, without its targeting protein, PP1c could not bind to merlin. Also, when the phosphatase activity of PP1c-TIMAP was inhibited either with depletion of TIMAP or by treatment of the cells with specific PP1 inhibitor, there was an increase in the amount of phospho-Ser518 form of merlin in the membrane of the cells. These data strongly suggest that the PP1c-TIMAP- complex dephosphorylates phospho-Ser518-merlin. ECIS measurements indicate that phospho-merlin accelerates in vitro wound healing of the endothelial monolayer. In conclusion, in endothelial cells, EBP50 is required for the nuclear localization of merlin and the PP1c-TIMAP holoenzyme plays an important role in the dephosphorylation of merlin on its Ser518 side chain, which influence cell migration and proliferation.