ARVCF, an armadillo-repeat protein of the p120(ctn) family, associates with classical cadherins and is present in adherens junctions, but its function is poorly understood. Here, we show that ARVCF interacts via a C-terminal PDZ-binding motif with zonula occludens (ZO)-1 and ZO-2. ARVCF and ZO-1 partially colocalize in the vicinity of the apical adhesion complex in polarized epithelial Madin-Darby canine kidney cells. ARVCF, ZO-1, and E-cadherin form a complex and are recruited to sites of initial cell-cell contact in sparse cell cultures. E-cadherin binding and plasma membrane localization of ARVCF require the PDZ-binding motif. Disruption of cell-cell adhesion releases ARVCF from the plasma membrane and an increased fraction of the protein localizes to the nucleus. Nuclear localization of ARVCF also requires the PDZ-binding motif and can be mediated by the PDZ domains of ZO-2. Thus, the interaction of ARVCF with distinct PDZ-domain proteins determines its subcellular localization. Interactions with ZO-1 and ZO-2, in particular, may mediate recruitment of ARVCF to the plasma membrane and the nucleus, respectively, possibly in response to cell-cell adhesion cues.