Villin is a major actin bundling protein in the brush border of epithelial cells. In this study we demonstrate for the first time, that villin can bundle actin filaments using a single F-actin binding site because it has the ability to self-associate. Using fluorescence resonance energy transfer (FRET), we demonstrate villin self-association in living cells in microvilli and in growth factor stimulated cells in membrane ruffles and lamellipodia. Using sucrose density gradient, size exclusion chromatography and MALDI-TOF, the majority of villin was identified as a monomer or dimer. Villin dimers were also identified in Caco-2 cells, which endogenously express villin and MDCK cells that ectopically express villin. Using truncation mutants of villin, site-directed mutagenesis and FRET an amino-terminal dimerization site was identified that regulated villin self-association in parallel conformation as well as actin-bundling by villin. This detailed analysis describes for the first time, microvillus assembly by villin, redefines the actin bundling function of villin and provides a molecular mechanism for actin-bundling by villin which could have wider implications for other actin crosslinking proteins, which share a villin-like headpiece domain. Our study also provides a molecular basis to separate the morphologically distinct actin severing and actin bundling properties of villin.