The mRNA-binding protein Ssd1 is a substrate for the Saccharomyces cerevisiae LATS/NDR orthologue Cbk1, which controls polarized growth, cell separation, and cell integrity. We discovered that most Ssd1 localizes diffusely within the cytoplasm, but some transiently accumulates at sites of polarized growth. Cbk1 inhibition and cellular stress cause Ssd1 to redistribute to mRNA processing bodies (P-bodies) and stress granules, which are known to repress translation. Ssd1 recruitment to P-bodies is independent of mRNA binding and is promoted by the removal of Cbk1 phosphorylation sites. SSD1 deletion severely impairs the asymmetric localization of the Ssd1-associated mRNA, SRL1. Expression of phosphomimetic Ssd1 promotes polarized localization of SRL1 mRNA, whereas phosphorylation-deficient Ssd1 causes constitutive localization of SRL1 mRNA to P-bodies and causes cellular lysis. These data support the model that Cbk1-mediated phosphorylation of Ssd1 promotes the cortical localization of Ssd1-mRNA complexes, whereas Cbk1 inhibition, cellular stress, and Ssd1 dephosphorylation promote Ssd1-mRNA interactions with P-bodies and stress granules, leading to translational repression.