Precise positioning of the cellular division plane is important for accurate segregation of genetic material and determination of daughter cell fates. Here we report a surprising connection between division site positioning and the organization of the cortical endoplasmic reticulum (ER). The cortical ER is an interconnected network of flat cisternae and highly curved tubules sharing a continuous lumen. Stabilization of high curvature by reticulon and DP1 family proteins contributes to formation of tubules. We show that in the fission yeast Schizosaccharomyces pombe, the ER network is maintained by a set of three membrane proteins: reticulon/Rtn1p, DP1/Yop1p, and a newly identified evolutionarily conserved protein, Tts1p. Cells lacking the ER domain sustained by these proteins exhibit severe defects in division plane positioning as a result of abnormal dispersion of a key regulator of division site selection, Mid1p, along the cell cortex. This triggers delocalized assembly of actomyosin cables and compromises their compaction into a single medially positioned ring. We propose that the cortical ER network restricts the lateral motion of Mid1p and hence generates a permissive zone for actomyosin ring assembly precisely at the cell equator.