Abstract Background Membrane-associated guanylate kinases (MAGUKs) form a family of scaffolding proteins, which are often associated with cellular junctions, such as the vertebrate tight junction, the Drosophila septate junction or the neuromuscular junction. Their capacity to serve as platforms for organising larger protein assemblies results from the presence of several protein-protein interaction domains. They often appear in different variants suggesting that they also mediate dynamic changes in the composition of the complexes. Results Here we show by electron microscopic analysis that Drosophila embryos lacking varicose function fail to develop septate junctions in the tracheae and the epidermis. In the embryo and in imaginal discs varicose expresses two protein isoforms, which belong to the MAGUK family. The two isoforms can be distinguished by the presence or absence of two L27 domains and are differentially affected in different varicose alleles. While the short isoform is essential for viability, the long isoform seems to have a supportive function. Varicose proteins co-localise with Neurexin IV in pleated septate junctions and are necessary, but not sufficient for its recruitment. The two proteins interact in vitro by the PDZ domain of Varicose and the four C-terminal amino acids of Neurexin IV. Postembryonic reduction of varicose function by expressing double-stranded RNA affects pattern formation and morphogenesis of the wing and the development of normal-shaped and -sized eyes. Conclusion Expression of two Varicose isoforms in embryonic epithelia and imaginal discs suggests that the composition of Varicose-mediated protein scaffolds at septate junctions is dynamic, which may have important implications for the modulation of their function.