Amer1/WTX binds to the tumor suppressor adenomatous polyposis coli and acts as an inhibitor of Wnt signaling by inducing -catenin degradation. We show here that Amer1 directly interacts with the armadillo repeats of -catenin via a domain consisting of repeated arginine-glutamic acid-alanine (REA) motifs, and that Amer1 assembles the -catenin destruction complex at the plasma membrane by recruiting -catenin, adenomatous polyposis coli, and Axin/Conductin. Deletion or specific mutations of the membrane binding domain of Amer1 abolish its membrane localization and abrogate negative control of Wnt signaling, which can be restored by artificial targeting of Amer1 to the plasma membrane. In line, a natural splice variant of Amer1 lacking the plasma membrane localization domain is deficient for Wnt inhibition. Knockdown of Amer1 leads to the activation of Wnt target genes, preferentially in dense compared with sparse cell cultures, suggesting that Amer1 function is regulated by cell contacts. Amer1 stabilizes Axin and counteracts Wnt-induced degradation of Axin, which requires membrane localization of Amer1. The data suggest that Amer1 exerts its negative regulatory role in Wnt signaling by acting as a scaffold protein for the -catenin destruction complex and promoting stabilization of Axin at the plasma membrane.The canonical Wnt/-catenin signaling pathway is a key pathway in embryonic development and disease. Aberrant activation of Wnt signaling leads to the development of tumors (1, 2). The binding of Wnt ligands to the transmembrane receptors Frizzled (Fz) 2 and low-density lipoprotein receptor-related protein 5 or 6 (LRP5/6) leads to the stabilization of cytoplasmic -catenin, which enters the nucleus and activates target gene expression by interacting with DNA-binding proteins of the T-cell factor/lymphoid enhancer factor (TCF/lymphoid enhancer factor) family (3, 4). In the absence of Wnts, -catenin is degraded in the proteasome after its ubiquitination by the E3 ligase -transducin repeat-containing protein (-TrCP), which recognizes -catenin phosphorylated at specific N-terminal residues. -catenin phosphorylation is accomplished by the coordinated action of CK1 and glycogen synthase kinase 3 (GSK3) and takes place in a multiprotein complex assembled by the scaffold proteins adenomatous polyposis coli (APC) and Axin or its homologue Axin2/Conductin (4, 5). Because Axin binds to -catenin, GSK, CK1, and APC, and APC has multiple binding sites for -catenin, it is generally believed that one function of this -catenin destruction complex is to bring -catenin into close vicinity to the kinases, thereby allowing efficient phosphorylation (6).It is generally thought that -catenin phosphorylation and degradation is a constitutive process, keeping the amount of -catenin in the cytoplasm and nucleus low in the absence of Wnts. Wnt binding to the receptor complex leads to the recruitment of Axin to the plasma membrane and phosphorylation of LRP5/6 at cytoplasmic PPPSPXS motifs (7-10). Phosphorylated PPPSPXS m...