Caveolae are small (50-100nm) membrane invaginations formed by caveolin proteins enriched with cholesterol and lipids. Caveolae play a crucial role in mechanoprotection and mechano-electrical transduction by buffering membrane tension and facilitating activation of mechanosensitive ion channels, including a recently discovered swelling-activated chloride channel SWELL1 (also known as LRRC8A). However, the dynamic relationship between the muscle-specific caveolar scaffolding protein caveolin-3 (Cav3) and SWELL1 is poorly understood. The objective of this study was to determine how Cav3 interacts with SWELL1 channels and modulates their activity during mechano-electrical transduction. In HEK 293 cells transfected with Cav3, co-immunoprecipitation analysis recapitulated cardiac data showing association between SWELL1 and Cav3. Using transiently expressed Cav3-GFP and SWELL1-mCherry fusion proteins in HEK293 cells, we observed a high FRET efficiency between the two proteins in an isotonic (1T) solution, confirming their close (<5nm) proximity. In a hypotonic solution (0.7T, mimicking cell stretch), FRET efficiency decreased two-fold. Furthermore, FRET efficiency decreased two-fold to control levels when incubated with methyl-beta cyclodextrin, a cholesterol solubilizer. These data suggest that the relationship between Cav3 and SWELL1 is dependent on membrane mechanical tension and caveolae lipid raft integrity. Interestingly, in transfected cells, SWELL1 protein expression and whole cell swelling-activated chloride current ( I Cl,swell ) were increased four-fold and two-fold, respectively, while mRNA expression was reduced two-fold. This may indicate that caveolae formed by Cav3 expression enrich for SWELL1 and increase their half-life, thus requiring lower mRNA availability despite higher protein expression. Our findings indicate a close dynamic interplay between Cav3 and SWELL1, with a strong regulatory action of Cav3 on I Cl,swell activity. Given that I Cl,swell increases and interprotein FRET efficiency decreases in hypotonic solution, it is likely that Cav3 inhibits the activation of SWELL1 similarly to its known inhibition of nitric oxide synthase.