Beta-catenin is an essential element for the transcriptional activation of target genes in the Wnt signaling cascade and is also a cell adhesion molecule that couples with cadherins. Although plakoglobin (gamma-catenin), a closely related homologue of beta-catenin, is also known to be a cell adhesion molecule, its function as a transcriptional factor has not been revealed in detail. Using a human malignant mesothelioma cell line, NCI-H28, in which we have identified a homozygous deletion of the beta-catenin gene, we studied whether plakoglobin has a T-cell factor/lymphocyte enhancer factor (TCF/LEF) family-dependent transcriptional activity. Transfection with the wild-type plakoglobin expression vector induced accumulation of plakoglobin in the nucleus. Immunoprecipitation assay with cotransfection of plakoglobin and either TCF-4 or LEF-1 detected binding of plakoglobin to TCF-4 or LEF-1. Luciferase reporter assay demonstrated transcriptional activity of the wild-type plakoglobin when transfected with TCF/LEF, although plakoglobin showed less activity than beta-catenin. Exogenous plakoglobin was also shown to promote entrance of exogenous beta-catenin into the nuclei. Furthermore, small interfering RNA directed against plakoglobin suppressed expression of endogenous plakoglobin and its transcriptional activity, suggesting that endogenous plakoglobin has a weak transcriptional activity. These results suggest that plakoglobin can activate the Wnt signaling cascade directly without interaction of beta-catenin, and that plakoglobin has multiple functions as a transcriptional activator and a cell adhesion molecule like beta-catenin.