beta-Catenin is essential for E-cadherin-mediated cell adhesion in epithelial cells and also acts as a key cofactor for transcription activity. We previously showed that protein kinase D1 (PKD1), founding member of the PKD family of signal transduction proteins, is down-regulated in advanced prostate cancer and interacts with E-cadherin. This study provides evidence that PKD1 interacts with and phosphorylates beta-catenin at Thr(112) and Thr(120) residues in vitro and in vivo; mutation of Thr(112) and Thr(120) results in increased nuclear localization of beta-catenin and is associated with altered beta-catenin-mediated transcription activity. It is known that mutation of Thr(120) residue abolishes binding of beta-catenin to alpha-catenin, which links to cytoskeleton, suggesting that PKD1 phosphorylation of Thr(120) could be critical for cell-cell adhesion. Overexpression of PKD1 represses beta-catenin-mediated transcriptional activity and cell proliferation. Epistatic studies suggest that PKD1 and E-cadherin are within the same signaling pathway. Understanding the molecular basis of PKD1-beta-catenin interaction provides a novel strategy to target beta-catenin function in cells including prostate cancer.