p120-catenin is a multidomain intracellular protein, which mediates a number of cellular functions, including stabilization of cell-cell transmembrane cadherin complexes as well as regulation of actin dynamics associated with barrier function, lamellipodia formation, and cell migration via modulation of the activities of small GTPAses. One mechanism involves p120 catenin interaction with Rho GTPase activating protein (p190RhoGAP), leading to p190RhoGAP recruitment to cell periphery and local inhibition of Rho activity. In this study, we have identified a stretch of 23 amino acids within the C-terminal domain of p120 catenin as the minimal sequence responsible for the recruitment of p190RhoGAP (herein referred to as CRAD; catenin-RhoGAP association domain). Expression of the p120-catenin truncated mutant lacking the CRAD in endothelial cells attenuated effects of barrier protective oxidized phospholipid, OxPAPC. This effect was accompanied by inhibition of membrane translocation of p190RhoGAP, increased Rho signaling, as well as suppressed activation of Rac1 and its cytoskeletal effectors PAK1 (p21-activated kinase 1) and cortactin. Expression of p120 catenin-truncated mutant lacking CRAD also delayed the recovery process after thrombin-induced endothelial barrier disruption. Concomitantly, RhoA activation and downstream signaling were sustained for a longer period of time, whereas Rac signaling was inhibited. These data demonstrate a critical role for p120-catenin (amino acids 820-843) domain in the p120-catenin·p190RhoGAP signaling complex assembly, membrane targeting, and stimulation of p190RhoGAP activity toward inhibition of the Rho pathway and reciprocal up-regulation of Rac signaling critical for endothelial barrier regulation.