Axin forms a complex with glycogen synthase kinase-3beta (GSK-3beta) and beta-catenin and promotes GSK-3beta-dependent phosphorylation of beta-catenin, thereby stimulating the degradation of beta-catenin. Because GSK-3beta also phosphorylates Axin in the complex, the physiological significance of the phosphorylation of Axin was examined. Treatment of COS cells with LiCl, a GSK-3beta inhibitor, and okadaic acid, a protein phosphatase inhibitor, decreased and increased, respectively, the cellular protein level of Axin. Pulse-chase analyses showed that the phosphorylated form of Axin was more stable than the unphosphorylated form and that an Axin mutant, in which the possible phosphorylation sites for GSK-3beta were mutated, exhibited a shorter half-life than wild type Axin. Dvl-1, which was genetically shown to function upstream of GSK-3beta, inhibited the phosphorylation of Axin by GSK-3beta in vitro. Furthermore, Wnt-3a-containing conditioned medium down-regulated Axin and accumulated beta-catenin in L cells and expression of Dvl-1(DeltaPDZ), in which the PDZ domain was deleted, suppressed this action of Wnt-3a. These results suggest that the phosphorylation of Axin is important for the regulation of its stability and that Wnt down-regulates Axin through Dvl.