Membrane targeting of pp60src (Src) is mediated by its myristoylated amino terminus. We demonstrate that, in addition to myristate, six basic residues in the amino terminus are essential for high-affinity binding to the lipid bilayer via electrostatic interaction with acidic phospholipids. Specifically, c-Src was shown to bind 2500-fold more strongly to vesicles composed of the physiological ratio of 2:1 phosphatidylcholine (PC)/phosphatidylserine (PS) than to neutral PC bilayer vesicles. The apparent Kd for binding of c-Src to the PC/PS bilayer was 6 x 10(-7) M. This interaction is sufficiently strong to account for c-Src membrane targeting. Mutants of c-Src in which the amino-terminal basic residues were replaced by neutral asparagine residues exhibited binding isotherms approaching that of wild-type binding to neutral bilayers (apparent Kd of 2 x 10(-3) M). The transforming v-Src and activated c-Src (Y527F) proteins also bound more strongly to PC/PS bilayers (apparent Kd of approximately 1 x 10(-5) M) than to neutral PC bilayers. In vivo experiments with Src mutants confirmed the role of positive charge in mediating membrane binding and cellular transformation.