Regulation of Wnt transcriptional targets is thought to occur by a transcriptional switch. In the absence of Wnt signaling, sequence‐specific DNA‐binding proteins of the TCF family repress Wnt target genes. Upon Wnt stimulation, stabilized β‐catenin binds to TCFs, converting them into transcriptional activators. C‐terminal‐binding protein (CtBP) is a transcriptional corepressor that has been reported to inhibit Wnt signaling by binding to TCFs or by preventing β‐catenin from binding to TCF. Here, we show that CtBP is also required for the activation of some Wnt targets in Drosophila. CtBP is recruited to Wnt‐regulated enhancers in a Wnt‐dependent manner, where it augments Armadillo (the fly β‐catenin) transcriptional activation. We also found that CtBP is required for repression of a subset of Wnt targets in the absence of Wnt stimulation, but in a manner distinct from previously reported mechanisms. CtBP binds to Wnt‐regulated enhancers in a TCF‐independent manner and represses target genes in parallel with TCF. Our data indicate dual roles for CtBP as a gene‐specific activator and repressor of Wnt target gene transcription.