We investigate the local tunnel magnetoresistance (TMR) effect within a single Co nanoisland using spin-polarized scanning tunneling microscopy. We observe a clear spatial modulation of the TMR ratio with an amplitude of ∼20% and a spacing of ∼1.3nm between maxima and minima around the Fermi level. This result can be ascribed to a spatially modulated spin polarization within the Co island due to spin-dependent quantum interference. Our combined experimental and theoretical study reveals that spin-dependent electron confinement affects all transport properties such as differential conductance, conductance, and TMR. We demonstrate that the TMR within a nanostructured magnetic tunnel junction can be controlled on a length scale of 1 nm through spin-dependent quantum interference.