Multidrug resistance proteins MRP1 and MRP2 transport a wide range of endo- and xenobiotics. However, with the exception of certain parts of the brain, MRP1 traffics to basolateral membranes of polarized cells, whereas MRP2 is apical in location and thus it is particularly important for systemic elimination of such compounds. Different regions of MRP1 and MRP2 seem to target them to their respective membrane locations. In addition to two "core" membrane spanning domains (MSDs) characteristic of ATP-binding cassette transporters, MRP1 and MRP2 have a third NH2-terminal MSD (MSD0), which is not required for basolateral targeting of MRP1, or for transport of at least some substrates. Here, we demonstrate that all elements necessary for apical targeting of MRP2 reside in MSD0 and the adjacent cytoplasmic loop (CL) 3. Furthermore, we show that this region of MRP2 can target the core of MRP1 to an exclusively apical location. Within MRP2 CL3, we identified a lysine-rich element that is essential for apical targeting. When introduced into MRP1, this element alone is sufficient to result in partial apical localization. However, exclusive targeting to the apical membrane seems to require the integrity of the entire region encompassing MSD0 and CL3 of MRP2. Because CL3 of MRP1 is critical for binding, transport, or both of several compounds, we also examined the function of hybrids containing all, or portions of MRP2 MSD0 and CL3. Our results indicate that CL3 is important for interaction with both the glutathione and glucuronide conjugates tested, but that different regions may be involved.