Heterotrimeric G proteins of the G12 subfamily mediate cellular signals leading to events such as cytoskeletal rearrangements, cell proliferation, and oncogenic transformation. Several recent studies have revealed direct effector proteins through which G12 proteins may transmit signals leading to various cellular responses. Our laboratory recently demonstrated that G12 proteins specifically interact with the cytoplasmic domains of several members of the cadherin family of cell adhesion molecules (Meigs, T. E., Fields, T. A., McKee, D. D., and Casey, P. J. (2001) Proc. Natl. Acad. Sci. USA 98, 519-524). This interaction causes -catenin to release from cadherin and relocalize to the cytoplasm and nucleus, where it participates in transcriptional activation. Here we report that two distinct regions of the epithelial cadherin (E-cadherin) tail are required for interaction with -catenin and G12, respectively. Deletion of an acidic, 19 amino acid region of E-cadherin abolishes its ability to bind -catenin in vitro, to inhibit -catenin-mediated transactivation or to stabilize -catenin, causes subcellular mislocalization of -catenin, and disrupts cadherin-mediated cell adhesion. On the other hand, deletion of a distinct 11 amino acid region of E-cadherin dramatically attenuates interaction with G12; furthermore, G12 is ineffective in stimulating -catenin release from an E-cadherin cytoplasmic domain lacking this putative G12-binding region. These findings indicate that G12 and -catenin do not compete for the same binding site on cadherin, and provide molecular targets for selectively disrupting the interaction of these proteins with cadherin.