Hypermethylation of CpG islands is well known as a major inactivation mechanism of tumor suppressor genes. E-cadherin (E-cad) as a tumor invasion suppressor has been reported in several invasive and metastatic carcinomas. However, its significance in carcinogenesis of primary non-small cell lung cancer (NSCLC) is not well documented. This study was designed to assess the significance with 95 pairs of carefully collected NSCLC tumors and corresponding nonmalignant tissue samples. We carried out PCR-SSCP (single-strand conformation polymorphism) and PCR-RFLP (restriction fragment length polymorphism) screening for DNA variants, bisulfite conversion-specific MSP for methylation analysis, reverse transcription (RT)-PCR for mRNA and immunohistochemistry (IHC) for protein expression assays. To investigate effect of promoter-hypermethylation on E-cad expression, we also did demethylation experiment in six cell lines. First, we found that the −160A carriers (a single nucleotide polymorphism (SNP) in the promoter region of E-cad) had an increased risk for lung cancer development when compared to DNA from healthy volunteers (OR (odds ratio)=2.81; 95% CI (confidence interval), 1.36–5.86). Methylation of E-cad occurred with a significantly higher frequency in tumors than corresponding normal peritumoral tissues (P<10⁻⁵). Reduced expression of E-cad was detected as a distinct molecular feature of tumors in comparison to corresponding counterparts. Moreover, the methylation alteration was detected more frequently in low-differentiated tumors than in well-differentiated ones. Defective expression of E-cad in methylated cell lines was markedly recovered after treated with 5-Aza-dC (5-aza-2′-deoxycytidine). Thus, promoter-hypermethylation of E-cad is significantly associated with its defective expression and tumor differentiation, and the demethylating observation proposes a therapeutic strategy to reverse the tumor's malignancy by restoring normal expression of E-cad.