P120-catenin is the prototypic member of a subfamily of Armadillo repeat domain (Arm domain) proteins involved in cell-cell adhesion. Interestingly, all members of the p120 subfamily have also been observed in the nucleus, suggesting that they have additional roles that have yet to be determined. Here, we have developed a novel model system for studying the nucleocytoplasmic shuttling capabilities of p120. We show that simultaneous deletion of both of the conventional nuclear localization sequences (NLSs) in p120 had little effect on its nuclear localization. Instead, the Armadillo repeat domain was essential, and deletion of Arm repeat 3 or Arm repeat 5 eliminated nuclear entry despite the presence of both NLSs. In addition, deletion of Arm repeat 8 resulted in constitutive nuclear localization of p120-3A in both E-cadherin-positive and -negative cell lines. Thus, the core shuttling functions are dependent on the Arm domain. We have also identified two regions within the N-terminus of p120 that modulate nuclear shuttling dynamics of p120. In cadherin-deficient cells, normal epithelial morphology could be restored by both WT-E-cadherin and p120 uncoupled E-cadherin mutants, but only WT-E-cadherin strongly reduced nuclear localization of p120. Moreover, structural changes in p120 that reduced its affinity for E-cadherin increased p120 nuclear localization. Thus, reduced shuttling in the presence of E-cadherin is principally due to sequestration, a condition that is probably dynamic under normal circumstances but completely lost in metastatic cells that have downregulated E-cadherin. Notably, Arm repeats 3 and 5 are necessary for both E-cadherin binding and nuclear translocation, indicating that these repeats have dual roles. Surprisingly, in the absence of E-cadherin there was significant colocalization of cytoplasmic p120 with elements of the tubulin cytoskeleton, particularly in perinuclear locations. Depolymerizing microtubules with nocodazole increased nuclear p120, whereas stabilizing tubulin with taxol reduced nuclear p120 and strongly increased p120 association with microtubules. Thus, p120 has intrinsic nucleocytoplasmic shuttling activity that is modulated, in part, by extrinsic factors such as cadherin binding and interactions with the microtubule network.