Two distinct signaling pathways, involving Wnt signaling and polycystin, have been found to be critical for normal kidney development. Renal tubulogenesis requires the presence of certain Wnt proteins, whereas mutations in polycystin impede the terminal differentiation of renal tubular epithelial cells, causing the development of large cystic kidneys that characterize autosomal dominant polycystic kidney disease. Polycystin is an integral membrane protein, consisting of several extracellular motifs indicative of cell-cell and cell-matrix interactions, coupled through multiple transmembrane domains to a functionally active cytoplasmic domain. We report here that expression of the C-terminal cytoplasmic domain of polycystin stabilizes soluble endogenous β-catenin and stimulates TCF- dependent gene transcription in human embryonic kidney cells. Microinjection of the polycystin C-terminal cytoplasmic domain induces dorsalization in zebrafish. Our findings suggest that polycystin has the capacity to modulate Wnt signaling during renal development.