Null-mutations of the Arabidopsis FKBP-like immunophilin TWISTED DWARF1 (TWD1) gene cause a pleiotropic phenotype characterized by reduction of cell elongation and disorientated growth of all plant organs. Heterologously expressed TWD1 does not exhibit cis-trans-peptidylprolyl isomerase (PPIase) activity and does not complement yeast FKBP12 mutants, suggesting that TWD1 acts indirectly via protein-protein interaction. Yeast two-hybrid protein interaction screens with TWD1 identified cDNA sequences that encode the C-terminal domain of Arabidopsis multidrug-resistance-like ABC transporter AtPGP1. This interaction was verified in vitro. Mapping of protein interaction domains shows that AtPGP1 surprisingly binds to the N-terminus of TWD1 harboring the cis-trans peptidyl-prolyl isomerase-like domain and not to the tetratrico-peptide repeat domain, which has been shown to mediate protein-protein interaction. Unlike all other FKBPs, TWD1 is shown to be an integral membrane protein that colocalizes with its interacting partner AtPGP1 on the plasma membrane. TWD1 also interacts with AtPGP19 (AtMDR1), the closest homologue of AtPGP1. The single gene mutation twd1-1 and double atpgp1-1/atpgp19-1 (atmdr1-1) mutants exhibit similar phenotypes including epinastic growth, reduced inflorescence size, and reduced polar auxin transport, suggesting that a functional TWD1-AtPGP1/AtPGP19 complex is required for proper plant development.