Human EB1 was originally cloned as a protein that interacts with the COOH terminus of adenomatous polyposis coli (APC). Interestingly, this interaction is often disrupted in colon cancer, due to mutations in APC. EB1 also interacts with the plus-ends of microtubules and targets APC to microtubule tips. Since APC is detected on the kinetochores of chromosomes, it has been hypothesized that the EB1-APC interaction connects microtubule spindles to the kinetochores and regulates microtubule stability. In yeast, EB1 regulates microtubule dynamics, and its binding domain in APC may be conserved in Kar9, an EB1 binding protein involved in the microtubule-capturing mechanism. These results suggest that the interaction of EB1 and APC is important and may be conserved. However, it is largely unknown whether the EB1-APC interaction affects microtubule dynamics. Here, we show that EB1 potently promotes microtubule polymerization in vitro and in permeabilized cells, but, surprisingly, only in the presence of the COOH-terminal EB1 binding domain of APC (C-APC). Significantly, this C-APC activity is abolished by phosphorylation, which also disrupts its ability to bind to EB1. Furthermore, yeast EB1 protein effectively substitutes for the human protein but also requires C-APC in promoting microtubule polymerization. Finally, C-APC is able to promote microtubule polymerization when stably expressed in APC mutant cells, demonstrating the ability of C-APC to promote microtubule assembly in vivo. Thus, the interaction between EB1 and APC plays an essential role in the regulation of microtubule polymerization, and a similar mechanism may be conserved in yeast.