Inactivating mutations in the adenomatous polyposis coli gene (APC), and activating mutations in RAS, occur in a majority of colorectal carcinomas. However, the relationship between these changes and tumorigenesis is poorly understood. RAS-induced activation of the ERK pathway was reduced by overexpressing APC in DLD-1 colorectal cancer cells. ERK activity was increased by Cre-virus-induced Apc knockout in primary Apc(flox/flox) mouse embryonic fibroblasts, indicating that APC inhibits ERK activity. ERK activity was increased by overexpression and decreased by knock down of beta-catenin. The activation of Raf1, MEK and ERK kinases by beta-catenin was reduced by co-expression of APC. These results indicate that APC inhibits the ERK pathway by an action on beta-catenin. RAS-induced activation of the ERK pathway was reduced by the dominant negative form of TCF4, indicating that the ERK pathway regulation by APC/beta-catenin signaling is, at least, partly caused by effects on beta-catenin/TCF4-mediated gene expression. The GTP loading and the protein level of mutated RAS were decreased in cells with reduced ERK activity as a result of APC overexpression, indicating that APC regulates RAS-induced ERK activation at least partly by reduction of the RAS protein level. APC regulates cellular proliferation and transformation induced by activation of both RAS and beta-catenin signaling.