Activation of the type 1 histamine (H1) or the type 2 protease-activated (PAR-2) G protein-coupled receptors interrupts E-cadherin adhesion and decreases the transepithelial resistance (TER) of epithelium. Several reports suggest that cadherin adhesive function depends on the association of cadherin with beta-catenin and that this association is regulated by phosphorylation of tyrosines in beta-catenin. We tested the hypothesis that loss of cadherin adhesion and compromise of TER on activation of the H1 or PAR-2 receptor is due to phosphorylation of tyrosines in beta-catenin. L cells were stably transfected to express E-cadherin (L-E-cad cells) and H1 (L-H1-E-cad cells). L cells and Madin-Darby canine kidney (MDCK) cells constitutively express PAR-2. Stably transfected L-E-cad, L-H1-E-cad, and MDCK cells were also stably transfected with FLAG-tagged wild-type (WT) or mutant beta-catenin, converting tyrosine 142, 489, or 654 to the nonphosphorylatable mimetic, phenylalanine (WT, Y142F, Y489F, or Y654F). Activation of H1 or PAR-2 interrupted adhesion to an immobilized E-cadherin-Fc fusion protein of L-H1-E-cad, L-E-cad, and MDCK cells expressing WT or Y142F beta-catenin but did not interrupt adhesion of L-H1-E-cad, L-E-cad, and MDCK cells expressing the Y489F or Y654F mutant beta-catenins. PAR-2 activation decreased the TER of monolayers of MDCK cells expressing WT or Y142F beta-catenin 40-45%. However, PAR-2 activation did not decrease the TER of monolayers of MDCK cells expressing Y489F or Y654F beta-catenin. The protein tyrosine phosphatase PTP1B binds to the cadherin cytoplasmic domain and dephosphorylates beta-catenin. Inhibition of PTP1B interrupted adhesion to E-cadherin-Fc of MDCK cells expressing WT beta-catenin but did not affect the adhesion of MDCK cells expressing Y489F or Y654F beta-catenin. Similarly, inhibition of PTP1B compromised the TER of MDCK cells expressing WT beta-catenin but did not affect the TER of MDCK cells expressing Y489F or Y654F beta-catenin. We conclude that phosphorylation of tyrosines 489 and 654 in beta-catenin is a necessary step in the process by which G protein-coupled H1 and PAR-2 receptors interrupt E-cadherin adhesion. We also conclude that activation of PAR-2 has no effect on the TER without first interrupting E-cadherin adhesion.