Protein palmitoylation is a major dynamic posttranslational regulator of protein function. However, mechanisms that control palmitoylation are poorly understood. In many proteins, palmitoylation occurs at cysteine residues juxtaposed to membrane-anchoring domains such as transmembrane helices, sites of irreversible lipid modification, or hydrophobic and/or polybasic domains. In particular, polybasic domains represent an attractive mechanism to dynamically control protein palmitoylation, as the function of these domains can be dramatically influenced by protein phosphorylation. Here we demonstrate that a polybasic domain immediately upstream of palmitoylated cysteine residues within an alternatively spliced insert in the C terminus of the large conductance calcium- and voltage-activated potassium channel is an important determinant of channel palmitoylation and function. Mutation of basic amino acids to acidic residues within the polybasic domain results in inhibition of channel palmitoylation and a significant right-shift in channel half maximal voltage for activation. Importantly, protein kinase A-dependent phosphorylation of a single serine residue within the core of the polybasic domain, which results in channel inhibition, also reduces channel palmitoylation. These data demonstrate the key role of the polybasic domain in controlling stress-regulated exon palmitoylation and suggests that phosphorylation controls the domain by acting as an electrostatic switch.