Abnormal phosphorylation of amyloid-beta precursor protein (APP) is a pathologic feature of Alzheimer's disease. To begin to understand the mechanism of APP phosphorylation, we studied this process in differentiating neurons under normal physiological conditions. We found that c-Jun NH2-terminal kinase (JNK), not cyclin-dependent kinase 5, is required for APP phosphorylation, leading to localized accumulation of phosphorylated APP (pAPP) in neurites. We show that JNK-interacting protein-3 (JIP-3), a JNK scaffolding protein that does not bind APP, selectively increases APP phosphorylation, accumulation of pAPP into processes, and stimulates process extension in both neurons and COS-1 cells. Downregulation of JIP-3 by small interfering RNA impairs neurite extension and reduces the amount of localized pAPP. Finally, whereas stress-activated JNK generates pAPP only in the cell body, concomitant expression of JIP-3 restores pAPP accumulation into neurites. Thus, APP phosphorylation, transport of the generated pAPP into neurites, and neurite extension are interdependent processes regulated by JIP-3/JNK, in a pathway distinct from stress-activated JNK signaling.