The neuronal microtubule-associated protein tau plays an important role in establishing cell polarity by stabilizing axonal microtubules that serve as tracks for motor-protein–driven transport processes. To investigate the role of tau in intracellular transport, we studied the effects of tau expression in stably transfected CHO cells and differentiated neuroblastoma N2a cells. Tau causes a change in cell shape, retards cell growth, and dramatically alters the distribution of various organelles, known to be transported via microtubule-dependent motor proteins. Mitochondria fail to be transported to peripheral cell compartments and cluster in the vicinity of the microtubule-organizing center. The endoplasmic reticulum becomes less dense and no longer extends to the cell periphery. In differentiated N2a cells, the overexpression of tau leads to the disappearance of mitochondria from the neurites. These effects are caused by tau's binding to microtubules and slowing down intracellular transport by preferential impairment of plus-end–directed transport mediated by kinesin-like motor proteins. Since in Alzheimer's disease tau protein is elevated and mislocalized, these observations point to a possible cause for the gradual degeneration of neurons.