In Wnt signaling, β-catenin and plakoglobin transduce signals to the nucleus through interactions with TCF-type transcription factors. However, when plakoglobin is artificially engineered to restrict it to the cytoplasm by fusion with the transmembrane domain of connexin (cnxPg), it efficiently induces a Wnt-like axis duplication phenotype in Xenopus. In Xenopus embryos, maternal XTCF3 normally represses ventral expression of the dorsalizing geneSiamois. Two models have been proposed to explain the Wnt-like activity of cnxPg: 1) that cnxPg inhibits the machinery involved in the turnover of cytosolic β-catenin, which then accumulates and inhibits maternal XTCF3, and 2) that cnxPg directly acts to inhibit XTCF3 activity. To distinguish between these models, we created a series of N-terminal deletion mutations of cnxPg and examined their ability to induce an ectopic axis in Xenopus, activate a TCF-responsive reporter (OT), stabilize β-catenin, and colocalize with components of the Wnt signaling pathway. cnxPg does not colocalize with the Wnt pathway component Dishevelled, but it does lead to the redistribution of APC and Axin, two proteins involved in the regulation of β-catenin turnover. Expression of cnxPg increases levels of cytosolic β-catenin; however, this effect does not completely explain its signaling activity. Although cnxPg and Wnt-1 stabilize β-catenin to similar extents, cnxPg activates OT to 10- to 20-fold higher levels than Wnt-1. Moreover, although LEF1 and TCF4 synergize with β-catenin and plakoglobin to activate OT, both suppress the signaling activity of cnxPg. In contrast, XTCF3 suppresses the signaling activity of both β-catenin and cnxPg. Both exogenous XLEF1 and XTCF3 are sequestered in the cytoplasm ofXenopus cells by cnxPg. Based on these data, we conclude that, in addition to its effects on β-catenin, cnxPg interacts with other components of the Wnt pathway, perhaps TCFs, and that these interactions contribute to its signaling activity.