Anhidrotic ectodermal dysplasia (EDA) is a rare X-linked recessive disorder characterized by the absence or hypoplasia of hair, teeth and sweat glands. The gene responsible for the disorder has recently been cloned. The predicted gene product is a 135 amino acid protein with no significant homology to previously known proteins. As a first step to analyze function, we have studied the subcellular localization of the EDA gene product expressed in two epithelial cell lines, COS-1 and MCF-7. Biochemical fractionation and confocal imaging analysis show that, in agreement with a single putative transmembrane domain inferred from its sequence, the EDA protein is transported to the plasma membrane. Moreover, in MCF-7 cells expression of EDA is associated with rounding and detachment of the cells. These results suggest that the EDA protein may be involved in cellular dynamics or signaling.