The most common form of blindness at birth, Leber's congenital amaurosis (LCA), is inherited in an autosomal recessive fashion. Mutations in six different retina-specific genes, including a recently discovered gene, AIPL1, have been linked to LCA in humans. To understand the molecular basis of LCA caused by aryl hydrocarbon receptor-interacting protein-like 1 (AIPL1) mutations, and to elucidate the normal function of AIPL1, we performed a yeast two-hybrid screen using AIPL1 as bait. The screen demonstrated that AIPL1 interacts specifically with farnesylated proteins. Mutations in AIPL1 linked to LCA compromise this activity. These findings suggest that the essential function of AIPL1 within photoreceptors requires interactions with farnesylated proteins. Analysis of isoprenylation in cultured human cells shows that AIPL1 enhances the processing of farnesylated proteins. Based on these findings, we propose that AIPL1 interacts with farnesylated proteins and plays an essential role in processing of farnesylated proteins in retina.