The atypical protein kinase C (PKC) isoenzymes, lambda/iota- and zetaPKC, play important roles in cellular signaling pathways regulating proliferation, differentiation, and cell survival. By using green fluorescent protein (GFP) fusion proteins, we found that wild-type lambdaPKC localized predominantly to the cytoplasm, whereas both a kinase-defective mutant and an activation loop mutant accumulated in the nucleus. We have mapped a functional nuclear localization signal (NLS) to the N-terminal part of the zinc finger domain of lambdaPKC. Leptomycin B treatment induced rapid nuclear accumulation of GFP-lambda as well as endogenous lambdaPKC suggesting the existence of a CRM1-dependent nuclear export signal (NES). Consequently, we identified a functional leucine-rich NES in the linker region between the zinc finger and the catalytic domain of lambdaPKC. The presence of both the NLS and NES enables a continuous shuttling of lambdaPKC between the cytoplasm and nucleus. Our results suggest that the exposure of the NLS in both lambda- and zetaPKC is regulated by intramolecular interactions between the N-terminal part, including the pseudosubstrate sequence, and the catalytic domain. Thus, either deletion of the N-terminal region, including the pseudosubstrate sequence, or a point mutation in this sequence leads to nuclear accumulation of lambdaPKC. The ability of the two atypical PKC isoforms to enter the nucleus in HeLa cells upon leptomycin B treatment differs substantially. Although lambdaPKC is able to enter the nucleus very rapidly, zetaPKC is much less efficiently imported into the nucleus. This difference can be explained by the different relative strengths of the NLS and NES in lambdaPKC compared with zetaPKC.