Proteins that contain PDZ domains have been implicated in the localization of interacting partners to specific regions of the cell membrane. Although PDZ proteins that bind to a number of important mammalian proteins have been isolated, the significance of these interactions is unclear. In recent years, the fruit fly has emerged as a rich system for genetic analysis of PDZ protein function. Here, I discuss what the Drosophila data tell us about the roles and mechanisms of PDZ protein activity, and how this informs our understanding of PDZ function in other organisms.