Polo kinases play critical roles for proper M-phase progression. They are characterized by the presence of two regions of homology in the C-terminal non-catalytic domain, termed polo-box 1 (PB1) and polo-box 2 (PB2). Here we demonstrate that both PB1 and PB2 are required for targeting the catalytic activity of PIk1 to centrosomes, midbody, and kinetochores. Expression of either kinase-inactive PLK1/K82M or the C-terminal plk1ΔN induced a pre-anaphase arrest with elevated Cdc2 and Plk1 activity. Prophase-arrested cells exhibited randomly oriented spindle structures, whereas metaphase cells exhibited aberrant bipolar spindles with Mad2 localization at kinetochores of misaligned chromosomes. Microtubule nucleation activity of centrosomes was not compromised. In vivo time-lapse studies revealed that expression of plk1ΔN resulted in repeated cycles of bipolar spindle formation and disruption, suggestive of a defect in spindle stability. A prolonged arrest frequently led to the generation of micronucleated cells in the absence of sisterchromatid separation and centrosome duplication, indicating that micronucleation is not a result of accumulated cytokinesis failures. Interestingly, bypass of the mitotic arrest by dominant-negative spindle checkpoint components led to a failure in completion of cytokinesis. We propose that, in mammalian cells, the polo-box-dependent Plk1 activity is required for proper metaphase/anaphase transition and for cytokinesis.