Actin- and microtubule-mediated changes in cell shape are essential for many cellular activities. However, the molecular mechanisms underlying the interplay between the two are complex and remain obscure. Here we show that the expression of delta-catenin (or NPRAP/Neurojungin), a member of p120(ctn) subfamily of armadillo proteins can induce the branching of dendrite-like processes in 3T3 cells and enhance dendritic morphogenesis in primary hippocampal neurons. This induction of branching phenotype involves initially the disruption of filamentous actin, and requires the growth of microtubules. The carboxyl-terminal truncation mutant of delta-catenin can cluster and redistribute the full-length protein, and dominantly inhibit its branching effect. delta-Catenin forms protein complexes and can bind directly to actin in vitro. The carboxyl-terminal truncation of delta-catenin does not interfere with its actin-binding capability; therefore the actin interaction alone is not sufficient for the induction of dendrite-like processes. When delta-catenin-transformed cells establish elaborate dendrite-like branches, the main cellular processes become stabilized and resist the disruption of both actin filaments and microtubules, as determined by fluorescent light microscopy and time-lapse recording analyses. We suggest that delta-catenin can effect a biphasic cytoskeletal remodeling event which differentially regulates actin and microtubules and promotes cellular morphogenesis.