The aim of the current study was to examine the influence of transforming growth factor (TGF)-β1 on proximal tubular epithelial cell-cell interaction, with particular emphasis on the regulation of adherens junction complex formation. Stimulation of the proximal tubular cell line HK-2 cells by TGF-β1 led to loss of cell-cell contact and disassembly of both adherens and tight junctional complexes. Adherens junction disassembly was associated with reduction of both Triton-soluble and Triton-insoluble E-cadherin, and an increase in detergent-soluble β-catenin. Under these conditions, immunoprecipitation and Western analysis demonstrated decreased association of β-catenin, both with E-cadherin, α-catenin, and the cell cytoskeleton. Confocal microscopy after immunostaining, showed decreased intensity of peripheral E-cadherin staining, and redistribution of β-catenin expression to a perinuclear location. Tight junction disassembly was manifest by a reduction in the expression of Triton-soluble occludin and ZO-1 by Western analysis and their disassociation manifested by immunostaining and confocal microscopy. Loss of cell-cell contact and disassembly of adherens junctions were seen after addition of TGF-β1 to the basolateral aspect of the cells. Immunoprecipitation experiments demonstrated co-localization of E-cadherin, β-catenin, and TGF-β1 RII in unstimulated cells. After TGF-β1 stimulation, the TGF-β1 RII no longer associated with either E-cadherin or β-catenin. Dissociation of the adherens junction protein from the TGF-β1 receptor was associated with increased β-catenin tyrosine phosphorylation and decreased threonine phosphorylation. Furthermore after receptor ligand binding, β-catenin became associated with the TGF-β1-signaling molecules Smad3 and Smad4.