The small guanosine triphosphatases (GTPases) Cdc42 and Rac1 regulate E-cadherin–mediated cell-cell adhesion. IQGAP1, a target of Cdc42 and Rac1, was localized with E-cadherin and β-catenin at sites of cell-cell contact in mouse L fibroblasts expressing E-cadherin (EL cells), and interacted with E-cadherin and β-catenin both in vivo and in vitro. IQGAP1 induced the dissociation of α-catenin from a cadherin-catenin complex in vitro and in vivo. Overexpression of IQGAP1 in EL cells, but not in L cells expressing an E-cadherin–α-catenin chimeric protein, resulted in a decrease in E-cadherin–mediated cell-cell adhesive activity. Thus, IQGAP1, acting downstream of Cdc42 and Rac1, appears to regulate cell-cell adhesion through the cadherin-catenin pathway.