A regulatory volume decrease response occurs when skate (Raja erinacea) erythrocytes are exposed to hyposmotic medium; they swell and then reduce their volume by releasing organic osmolytes (primarily taurine) and associated water. The response involves the red blood cell anion-exchanger skate anion-exchanger 1 (skAE1), which has been previously shown to be affected by tyrosine phosphorylation, to form tetramers and to change binding affinities to the cytoskeletal proteins, ankyrin and band 4.1. Our recent studies are focused on determining the sequence and mechanism of these events to better understand the activation of skAE1 upon hyposmotic stimulation. Under isosmotic conditions a large portion of skAE1 is found not only on the plasma membranes but also associated intracellularly in detergent-resistant membranes or lipid rafts. We hypothesize that an important step in the hyposmotic-induced increase in taurine transport involves the movement of skAE1 from an intracellular association with lipid rafts into the cell membrane. Inhibition of tyrosine phosphorylation of skAE1 with piceatannol reduces the hyposmotic-induced increase in taurine transport and also inhibits both the decreased binding of skAE1 to band 4.1 and the increased affinity to ankyrin. However, the phosphorylation inhibitor does not block the movement of the transporter into the plasma membrane or the formation of tetramers. This suggests that tyrosine phosphorylation is important in the hyposmotic-induced taurine transport but other steps that do not require phosphorylation play an important role.