Atypical protein kinase iota (PKC iota) is a key organizer of the apical domain in epithelial cells. Ezrin is a cytosolic protein that, upon activation by phosphorylation of T567, is localized under the apical membrane where it connects actin filaments to membrane proteins and recruits protein kinase A (PKA). To identify the kinase that phosphorylates ezrin T567 in simple epithelia, we analyzed the expression of active PKC and the appearance of T567-P during enterocyte differentiation in vivo. PKC iota phosphorylated ezrin on T567 in vitro, and in Sf9 cells that do not activate human ezrin. In CACO-2 human intestinal cells in culture, PKC iota co-immunoprecipitated with ezrin and was knocked down by shRNA expression. The resulting phenotype showed a modest decrease in total ezrin, but a steep decrease in T567 phosphorylation. The PKC iota-depleted cells showed fewer and shorter microvilli and redistribution of the PKA regulatory subunit. Expression of a dominant-negative form of PKC iota also decreased T567-P signal, and expression of a constitutively active PKC iota mutant showed depolarized distribution of T567-P. We conclude that, although other molecular mechanisms contribute to ezrin activation, apically localized phosphorylation by PKC iota is essential for the activation and normal distribution of ezrin at the early stages of intestinal epithelial cell differentiation.