The calmodulin hypothesis of ectodomain shedding stipulates that calmodulin, an intracellular Ca2+-dependent regulatory protein, associates with the cytoplasmic domain of L-selectin to regulate ectodomain shedding of L-selectin on the other side of the plasma membrane. To understand the underlying molecular mechanism, we have characterized the interactions of calmodulin with two peptides derived from human L-selectin. The peptide ARR18 corresponds to the entire cytoplasmic domain of L-selectin (residues Ala317–Tyr334 in the mature protein), and CLS corresponds to residues Lys280–Tyr334, which contains the entire transmembrane and cytoplasmic domains of L-selectin. Monitoring the interaction by fluorescence spectroscopy and other biophysical techniques, we found that calmodulin can bind to ARR18 in aqueous solutions or the L-selectin cytoplasmic domain of CLS reconstituted in the phosphatidylcholine bilayer, both with an affinity of approximate 2 μM. The association is calcium-independent, dynamic and involves both lobes of calmodulin. In a phospholipid bilayer, the positively charged L-selectin cytoplasmic domain of CLS is associated with anionic phosphatidylserine lipids at the membrane interface through electrostatic interactions. Under conditions where the phosphatidylserine content mimics that in the inner leaflet of the cell plasma membrane, the interaction between calmodulin and CLS becomes undetectable. These results suggest that the association of calmodulin with L-selectin in the cell can be influenced by the membrane bilayer, and that anionic lipids may modulate ectodomain shedding of transmembrane receptors.