An expression screen of a rat cDNA library for sequences encoding Golgi-localized integral membrane proteins identified a protein with an apparent novel topology, i.e. with both an N-terminal transmembrane domain and a C-terminal glycosyl-phosphatidylinositol (GPI) anchor. Our data are consistent with this. Thus, the protein would have a topology that, in mammalian cells, is shared only by a minor, but pathologically important, topological isoform of the prion protein (PrP). The human orthologue of this protein has been described previously (BST-2 or HM1.24 antigen) as a cell surface molecule that appears to be involved in early pre-B-cell development and which is present at elevated levels at the surface of myeloma cells. We show that rat BST-2/HM1.24 has both a cell surface and an intracellular (juxtanuclear) location and is efficiently internalized from the cell surface. We also show that the cell surface pool of BST-2/HM1.24 is predominantly present in the apical plasma membrane of polarized cells. The fact that rat BST-2/HM1.24 apparently possesses a GPI anchor led us to speculate that it might exist in cholesterol-rich lipid microdomains (lipid rafts) at the plasma membrane. Data from several experiments are consistent with this localization. We present a model in which BST-2/HM1.24 serves to link adjacent lipid rafts within the plasma membrane.