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Cadherin-mediated cell-cell adhesion is perturbed in protein tyrosine kinase (PTK)-transformed cells. While cadherins themselves appear to be poor PTK substrates, their cytoplasmic binding partners, the Arm catenins, are excellent PTK substrates and therefore good candidates for mediating PTK-induced changes in cadherin behavior. These proteins, p120ctn, beta-catenin and plakoglobin, bind to the cytoplasmic region of classical cadherins and function to modulate adhesion and/or bridge cadherins to the actin cytoskeleton. In addition, as demonstrated recently for beta-catenin, these proteins also have crucial signaling roles that may or may not be related to their effects on cell-cell adhesion. Tyrosine phosphorylation of cadherin complexes is well documented and widely believed to modulate cell adhesiveness. The data to date, however, is largely correlative and the mechanism of action remains unresolved. In this review, we discuss the current literature and suggest models whereby tyrosine phosphorylation of Arm catenins contribute to regulation or perturbation of cadherin function.