SanDisk will supply Sony with flash memory, and Sony will supply finished Memory Stick cards back to SanDisk for resale.
The deal also calls for the two companies to work together on development and separate manufacturing of next-generation Memory Stick media. Those cards are expected to appear in the "near future", according to Sony spokesman, Atsuo Omagari.
Omagari would not disclose details of the new cards, although he said they would operate at higher speeds and have capacities of "several gigabytes".
For Sony and its millions of Memory Stick users, the deal means a third source for the memory cards. In addition to its own-brand cards, Lexar Media began selling Memory Stick shortly after Sony made a $2 million investment in the company in April 2000.