Human T-cell leukemia virus type 1 (HTLV-1) is the etiologic agent of adult T-cell leukemia (ATL). The viral regulatory protein Tax1 plays a pivotal role in T-cell transformation and ATL development. Previous studies in our laboratory, using the yeast 2-hybrid approach to screen a T-cell library for Tax1-interacting partners, identified the cellular Four and a Half Lim domain protein 3 (FHL3) as a possible Tax1-interacting candidate. FHL3 is a member of the FHL family of proteins, which function as transcriptional coactivators and cytoskeleton regulators and have a role in cancer progression and development. The aim of this study was to investigate the physical and functional interaction between Tax1 and members of the FHL family of proteins. We show that Tax1 and FHL3 interact both in vitro and in vivo. Furthermore, both FHL1 and -2 also interact with Tax1. We have demonstrated that FHL3 enhances Tax1-mediated activation of the viral long terminal repeat (LTR) without affecting basal activity and that FHL1 to -3 regulate NF-κB activation by Tax1 in a cell-specific manner. In addition, we have found that the interaction between Tax1 and FHL1 to -3 affects the localization of these proteins, leading to their redistribution in cells. Tax1 also affected FHL3 cytoskeleton function by increasing FHL3-mediated cell spreading. Overall, our results suggest that the interaction between Tax1 and the FHL family alters both the transactivating activity and the subcellular localization of Tax1 and provide new insights into molecular mechanisms that underlie the oncogenic nature of this HTLV-1 protein.