It is widely recognized that the claudin (Cldn) family of four tetraspan transmembrane proteins is crucial for tight junction assembly and permeability barrier function; however, the precise role of the tail and loop domains in Cldn function is not understood. We hypothesized that the cytoplasmic tail domain of Cldn6 is crucial for membrane targeting and hence epidermal permeability barrier (EPB) formation. To test this hypothesis via a structure-function approach, we generated a tail deletion of Cldn6 (CDelta187) and evaluated its role in epidermal differentiation and EPB formation through its forced expression via the involucrin (Inv) promoter in the suprabasal compartment of the transgenic mouse epidermis. Even though a functional barrier formed, Inv-CDelta187 mice displayed histological and biochemical abnormalities in the epidermal differentiation program and stimulation of epidermal cell proliferation in both the basal and suprabasal compartments of the interfolliclar epidermis, leading to a thickening of the epidermis after 1 week of age that persisted throughout life. Although some membrane localization was evident, our studies also revealed a significant amount of not only Cldn6 but also Cldn10, Cldn11, and Cldn18 in the cytoplasm of transgenic epidermal cells as well as the activation of a protein-unfolding pathway. These findings demonstrate that the overexpression of a tail truncation mutant of Cldn6 mislocalizes Cldn6 and other Cldn proteins to the cytoplasm and triggers a postnatal increase in proliferation and aberrant differentiation of the epidermis, emphasizing the importance of the Cldn tail domain in membrane targeting and function in vivo.