The activity of E-cadherin-adhesion complexes is under stringent control of signaling pathways. Conversely, these adhesion complexes are preferential sites for signal transduction. One class of signaling molecules reported to regulate adherens junction and to be activated by adherens junction assembly are phosphatidylinositol 3-kinases. While the exact molecular mechanisms involved are not clear, present data indicate that one of the earliest events likely involves c-Src which is rapidly activated by E-cadherin-mediated cellular aggregation and may facilitate the recruitment and activation of PI3K to E-cadherin-containing complexes. Beta-catenin, gamma-catenin and hDlg which are present at cell-cell adhesions can act as docking proteins for PI3K. Hence, cell-cell interaction leads to PtdIns(3,4,5)P3 production in nascent cadherin contacts triggering the recruitment of proteins containing pleckstrin homology domains including the kinase PKB/Akt and the exchange factors for Rac, Tiam and Vav. PKB/Akt may be involved in the regulation of survival and proliferation while Tiam and Vav may activate Rac, resulting in reorganization of actin cytoskeleton which ultimately serves to mediate adhesive cell-cell recognition as well as epithelial cell differentiation and polarity.