The synaptic vesicle membrane protein synaptotagmin (tagmin) is essential for fast, calcium-dependent, neurotransmitter release and is likely to be the calcium sensor for exocytosis, because of its many calcium-dependent properties. Polyphosphoinositides are needed for exocytosis, but it has not been known why. We now provide a possible connection between these observations with the finding that the C2B domain of tagmin I binds phosphatidylinositol-4,5-bisphosphate (PIns-4,5-P-2), its isomer phosphatidylinositol-3,4-bisphosphate and phosphatidylinositol-3,4,5-trisphosphate (PIns-3,4,5-P-3). Calcium ions switch the specificity of this binding from PIns-3,4,5-P-3 (at calcium concentrations found in resting nerve terminals) to PIns-4,5-P-2 (at concentration of calcium required for transmitter release). Inositol polyphosphates, known blockers of neurotransmitter release, inhibit the binding of both PIns-4,5-P-2 and PIns-3,1,5-P-3 to tagmin. Our findings imply that tagmin may operate as a bimodal calcium sensor, switching bound lipids during exocytosis. This connection to polyphosphoinositides, compounds whose levels are physiologically regulated, could be important for longterm memory and learning.