Neurotransmitters and peptide hormones are secreted by regulated vesicle exocytosis. CAPS (also known as CADPS) is a 145-kDa cytosolic and peripheral membrane protein required for vesicle docking and priming steps that precede Ca2+-triggered vesicle exocytosis. CAPS binds phosphatidylinositol 4,5-bisphosphate (PI(4,5)P2) and SNARE proteins and is proposed to promote SNARE protein complex assembly for vesicle docking and priming. We characterized purified soluble CAPS as mainly monomer in equilibrium with small amounts of dimer. However, the active form of CAPS bound to PC12 cell membranes or to liposomes containing PI(4,5)P2 and Q-SNARE proteins was mainly dimer. CAPS dimer formation required its C2 domain based on mutation or deletion studies. Moreover, C2 domain mutations or deletions resulted in a loss of CAPS function in regulated vesicle exocytosis, indicating that dimerization is essential for CAPS function. Comparison of the CAPS C2 domain to a structurally defined Munc13-1 C2A domain dimer revealed conserved residues involved in CAPS dimerization. We conclude that CAPS functions as a C2 domain-mediated dimer in regulated vesicle exocytosis. The unique tandem C2-PH domain of CAPS may serve as a PI(4,5)P2-triggered switch for dimerization. CAPS dimerization may be coupled to oligomeric SNARE complex assembly for vesicle docking and priming.