Lis1, Nudel/NudE, and dynactin are regulators of cytoplasmic dynein, a minus end-directed, microtubule-based motor required for proper spindle assembly and orientation. In vitro studies have shown that dynactin promotes processive movement of dynein on microtubules whereas Lis1 causes dynein to enter a persistent force-generating state (referred to here as dynein stall). Yet, how the activities of Lis1, Nudel/NudE, and dynactin are coordinated to regulate dynein remains poorly understood in vivo. Working in Xenopus egg extracts, we show that Nudel/NudE facilitates the binding of Lis1 to dynein, which enhances the recruitment of dynactin to dynein. We further report a novel Lis1-dependent dynein-dynactin interaction that is essential for the organization of mitotic spindle poles. Finally, using assays for microtubule gliding and spindle assembly, we demonstrate an antagonistic relationship between Lis1 and dynactin that allows dynactin to relieve Lis1-induced dynein stall on microtubules. Our findings suggest the interesting possibility that Lis1 and dynactin could alternately engage with dynein to allow the motor to promote spindle assembly.