One of the pathological hallmarks of Alzheimer's disease (AD) is the presence of extracellular deposits of amyloid beta (Aβ) peptide. In addition to Aβ as the core component of the amyloid plaque, the amyloid precursor protein (APP) processing fragment Aβ was also found accumulated around the plaque. The APPη pathway, mainly mediated by membrane‐type 5 matrix metalloproteinase (MT5‐MMP), represents an important factor in AD pathogenesis. The proamyloidogenic features of MT5‐MMP could result from interactions with APP when trafficking between organelles, so determination of the location within the cell of APPη cleavage and interacting proteins of MT5‐MMP affecting this process will be of priority in understanding the role of MT5‐MMP in AD. In the present study, MT5‐MMP was found to be located in the nucleus, cytosol, and cytosolic subcellular granules of CHO cells that stably expressed wild‐type human APP751. MT5‐MMP fusion proteins were constructed that could localize enzyme production in the Golgi apparatus, endosome, ER, mitochondria, or plasma membrane. The fusion proteins significantly increased sAPPη when directed to the endosome, Golgi apparatus, plasma membrane, or mitochondria. Since the C‐terminal region of MT5‐MMP is responsible for its intracellular location and trafficking, this domain was used as the bait in a yeast two‐hybrid screen to identify MT5‐MMP protein partners in a human brain cDNA library. Identified binding partners included N4BP2L1, TMX3, EIG121, bridging Integrator 1 (BIN1), RUFY4, HTRA1, and TMEM199. The binding of N4BP2L1, EIG121, BIN1, or TMX3 to MT5‐MMP resulted in the most significant increase in sAPPη production. Thus, the action of MT5‐MMP on APP occurs in multiple locations within the cell and is facilitated by site‐specific binding partners.