Pendred's syndrome is an autosomal recessive disorder characterized by sensorineural deafness, goiter, and impaired iodide organification. It is caused by mutations in the PDS/SLC26A4 gene that encodes pendrin. Functionally, pendrin is a transporter of chloride and iodide in Xenopus oocytes and heterologous mammalian cells and a chloride/base exchanger in beta-intercalated cells of the renal cortical collecting duct. The partially impaired thyroidal iodide organification in Pendred's syndrome suggests a possible role of pendrin in iodide transport at the apical membrane of thyroid follicular cells, but experimental evidence for this concept is lacking. The iodide transport properties of pendrin were determined in polarized Madin-Darby canine kidney cells expressing the sodium iodide symporter (NIS), pendrin, or NIS and pendrin using a bicameral system-permitting measurement of iodide content in the basal, intracellular, and apical compartments. Moreover, we determined the functional consequences of two naturally occurring mutations (L676Q and FS306>309X). In polarized Madin-Darby canine kidney cells, NIS mediates uptake at the basolateral membrane. Only minimal amounts of iodide reach the apical compartment in the absence of pendrin. In cells expressing NIS and pendrin, pendrin mediates transport of iodide into the apical chamber. Wild type pendrin also mediates iodide efflux in transiently transfected cells. In contrast, both pendrin mutants lose the ability to promote iodide efflux. These results provide evidence that pendrin mediates apical iodide efflux from polarized mammalian cells loaded with iodide. Consistent with the partial organification defect observed in patients with Pendred's syndrome, naturally occurring mutations of pendrin lead to impaired transport of iodide.