We have found that a malignant mesothelioma cell line, NCI-H28, had a chromosome 3p21.3 homozygous deletion containing the beta-catenin gene (CTNNB1), which suggested that the deletion of beta-catenin might have a growth advantage in the development of this tumor. To determine whether beta-catenin has a growth-inhibitory activity, we transfected wild-type beta-catenin, Ser37Cys mutant beta-catenin as an activated type, and C-terminus deletion mutant beta-catenin that lacks the transcription activity, into the NCI-H28 cells. A non-small cell lung cancer cell line, NCI-H1299, which expressed endogenous beta-catenin, was also studied. We tested the localization of exogenous beta-catenin in the NCI-H28 cells with immunofluorescence, and found that the wild-type beta-catenin and the C-terminus deletion mutant were more strongly expressed in the plasma membrane and cytoplasm than in the nucleus, while the Ser37Cys mutant was more in the nucleus than in the cytoplasm. By using luciferase-reporter assay, the beta-catenin/T-cell factor 4-mediated transactivity of the Ser37Cys mutant was shown to be higher than that of the wild-type beta-catenin in both cell lines. However, the transactivity of the C-terminus deletion mutant was strongly reduced in both. Colony formation of the NCI-H28 cells was reduced by 50% after transfection with the wild-type beta-catenin, and 60% with the Ser37Cys mutant, but only 20% with the C-terminus deletion mutant compared to the vector control. Inhibition of colony formation in NCI-H28 cells was because of apoptosis, manifested by positive staining of Annexin V and TUNEL assays in transfected cells. In contrast, when transfected with the wild-type beta-catenin, no significant reduction in colony formation was seen in beta-catenin wild-type NCI-H1299 cells. In conclusion, our data indicate that inactivation of beta-catenin by a 3p21.3 homozygous deletion might be a crucial event in the development of the mesothelioma NCI-H28 cells. Thus, while beta-catenin is well known to be a positive growth-stimulating factor for many human cancers, it can also act as a potential growth suppressor in some types of human cancer cells.