Magnetoreception of the light-dependent magnetic compass in birds is suggested to be mediated by a radical-pair mechanism taking place in the avian retina. Biophysical models on magnetic field effects on radical pairs generally assume that the light activating the magnetoreceptor molecules is nondirectional and unpolarized, and that light absorption is isotropic. However, natural skylight enters the avian retina unidirectionally, through the cornea and the lens, and is often partially polarized. In addition, cryptochromes, the putative magnetoreceptor molecules, absorb light anisotropically, i.e., they preferentially absorb light of a specific direction and polarization, implying that the light-dependent magnetic compass is intrinsically polarization sensitive. To test putative interactions between the avian magnetic compass and polarized light, we developed a spatial orientation assay and trained zebra finches to magnetic and/or overhead polarized light cues in a four-arm “plus” maze. The birds did not use overhead polarized light near the zenith for sky compass orientation. Instead, overhead polarized light modulated light-dependent magnetic compass orientation, i.e., how the birds perceive the magnetic field. Birds were well oriented when tested with the polarized light axis aligned parallel to the magnetic field. When the polarized light axis was aligned perpendicular to the magnetic field, the birds became disoriented. These findings are the first behavioral evidence to our knowledge for a direct interaction between polarized light and the light-dependent magnetic compass in an animal. They reveal a fundamentally new property of the radical pair-based magnetoreceptor with key implications for how birds and other animals perceive the Earth’s magnetic field.