Hypoxia-inducible factor-1 (HIF-1), a transcriptional complex composed of an oxygen-sensitive alpha- and a beta-subunit, plays a pivotal role in cellular adaptation to low oxygen availability. Under normoxia, the alpha-subunit of HIF-1 is hydroxylated by a family of prolyl hydroxylases (PHDs) and consequently targeted for proteasomal degradation. Three different PHDs have been identified, but the difference among their in vivo roles remain unclear. PHD3 is strikingly expressed by hypoxia, displays high substrate specificity, and has been identified in other signaling pathways. PHD3 may therefore hydroxylate divergent substrates and/or connect divergent cellular responses with HIF. We identified a novel WD-repeat protein, recently designated Morg1 (MAPK organizer 1), by screening a cDNA library with yeast two-hybrid assays. The interaction between PHD3 and Morg1 was confirmed in vitro and in vivo. We found seven WD-repeat domains by cloning the full-length cDNA of Morg1. By confocal microscopy both proteins co-localize within the cytoplasm and the nucleus and display a similar tissue expression pattern in Northern blots. Binding occurs at a conserved region predicted to the top surface of one propeller blade. Finally, HIF-mediated reporter gene activity is decreased by Morg1 and reduced to basal levels when Morg1 is co-expressed with PHD3. Suppression of Morg1 or PHD3 by stealth RNA leads to a marked increase of HIF-1 activity. These results indicate that Morg1 specifically interacts with PHD3 most likely by acting as a molecular scaffold. This interaction may provide a molecular framework between HIF regulation and other signaling pathways.