Myosin light chain phosphatase (PP1M) is composed of three subunits, i.e., M20, MBS, and a catalytic subunit. Whereas MBS is assigned as a myosin binding subunit, the function of M20 is unknown. In the present study, we found that M20 binds to microtubules. The binding activity was revealed by cosedimentation of M20 with microtubules and binding of tubulin to M20 affinity resin. Green fluorescent protein (GFP)-tagged M20 (M20-GFP) was expressed in chicken primary smooth muscle cells and COS-7 cells and was used as a probe for studying the association between M20 and microtubules in living cells. M20-GFP was localized on filamentous structures in both cell types. Colocalization analysis revealed that M20-GFP colocalized with tubulin. Treatment with nocodazole, but not cytochalasin B, abolished the filamentous structure of M20-GFP. These results indicate that M20-GFP associates with microtubules in cells. Microinjection of rhodamine-tubulin into the M20-expressing cells revealed that incorporation of rhodamine-tubulin into microtubules was significantly facilitated by microtubule-associated M20. Consistent with this result, M20 enhanced the rate of tubulin polymerization in vitro and produced elongated microtubules. These results suggest that M20 has a microtubule binding activity and plays a role in regulating microtubule dynamics.