Hepatocyte growth factor/scatter factor (HGF) is unique by inducing epithelial cell scattering, a cellular event pivotal to HGF-mediated invasive-growth response essential for embryonic development and metastasis. Krüppel-like factor 4 (KLF4) is a multifunctional zinc-finger transcription factor involved in cell proliferation, differentiation and self-renewal. We herein present the first evidence for the functional connection between KLF4 and HGF-induced cell scattering. In particular, we found that KLF4 was upregulated by HGF in two independent epithelial cell types, HepG2 and MDCK, whereas KLF4 knockdown inhibited HGF-induced E-cadherin suppression and cell scattering. Moreover, enforced nuclear KLF4 expression alone was sufficient to upregulate KLF4, downregulate E-cadherin and trigger scattering. Chromatin immunoprecipitation (ChIP) analysis further revealed that KLF4 induced suppression of E-cadherin transcription by directly binding to the E-cadherin promoter. Additionally, we proved that HGF-induced upregulation of KLF4 transcription and cell scattering require activation of the MEK/ERK signaling pathway and the induction of early growth response 1 (EGR-1). At the mechanistic level, ChIP analysis validated a direct binding of EGR-1 to the KLF4 promoter to induce KLF4 transcription; in turn, EGR-1-induced KLF4 binds to its own promoter, thus creating a positive feedback mechanism to sustain KLF4 expression and the resultant cell scattering. We conclude that KLF4 upregulation by HGF represents a novel mechanism mediating HGF-induced cell scattering and perhaps other associated events such as cell migration and invasion.