The localization and phosphorylation state of tau in LA-N-5 neuroblastoma cells was examined. Our results demonstrate that there are two populations of tau in LA-N-5 cells: cytosolic tau and nuclear tau. Indirect immunofluorescent microscopy revealed that nuclear tau is specifically localized to the nucleolus while cytosolic tau is diffusely distributed. To localize and quantitate tau in LA-N-5 cells by subcellular fractionation, a method was developed to extract tau from the nucleus while preserving the endogenous state of the protein. These studies revealed that 16% of the total tau protein in LA-N-5 cells is located in the nucleus and more specifically was found predominantly in the chromatin fraction containing DNA, chromatin, and associated proteins. The phosphorylation state of nuclear and cytosolic tau was examined by labeling LA-N-5 cells with 32Pi and immunoprecipitating tau from the different fractions. These data demonstrated that nuclear tau and cytosolic tau are phosphorylated approximately to the same extent. To determine if the phosphorylation of nuclear tau occurs in the nucleus, LA-N-5 nuclei were isolated, incubated with [gamma-32P]ATP, extracted, and tau was immunoprecipitated. Although numerous nuclear proteins were 32P-labeled, tau was not phosphorylated. These results suggest that nuclear tau is not phosphorylated in the nucleus but rather in the cytosol prior to transport into the nucleus. The specific localization of nuclear tau strongly suggests that it has a functional role in the nucleus. However, further studies are necessary to determine the function of nuclear tau and how it may be regulated by phosphorylation.