The localization of specific mRNAs can establish local protein gradients that generate and control the development of cellular asymmetries. While all evidence underscores the importance of the cytoskeleton in the transport and localization of RNAs, we have limited knowledge of how these events are regulated. Using a visual screen for motile proteins in a collection of GFP protein trap lines, we identified the Drosophila IGF-II mRNA-binding protein (Imp), an ortholog of Xenopus Vg1 RNA binding protein and chicken zipcode-binding protein. In Drosophila, Imp is part of a large, RNase-sensitive complex that is enriched in two polarized cell types, the developing oocyte and the neuron. Using time-lapse confocal microscopy, we establish that both dynein and kinesin contribute to the transport of GFP-Imp particles, and that regulation of transport in egg chambers appears to differ from that in neurons. In Drosophila, loss-of-function Imp mutations are zygotic lethal, and mutants die late as pharate adults. Imp has a function in Drosophila oogenesis that is not essential, as well as functions that are essential during embryogenesis and later development. Germline clones of Imp mutations do not block maternal mRNA localization or oocyte development, but overexpression of a specific Imp isoform disrupts dorsal/ventral polarity. We report here that loss-of-function Imp mutations, as well as Imp overexpression, can alter synaptic terminal growth. Our data show that Imp is transported to the neuromuscular junction, where it may modulate the translation of mRNA targets. In oocytes, where Imp function is not essential, we implicate a specific Imp domain in the establishment of dorsoventral polarity.