Fos proteins, the prototypic members of basic region-leucine zipper (bZIP) transcription factors, bind to other bZIP proteins to form the activator protein-1 (AP-1) complex, which regulates the expression of a plethora of target genes. Notably, c-Fos target genes include members of the matrix metalloproteinase (MMP) gene family and c-fos is overexpressed in a number of metastatic cancers, suggesting its direct involvement in this process. Here, we reveal that c-Fos-mediated transcriptional activation is regulated by the protein arginine methyltransferase CARM1 and by all three members of the p160 protein family of coactivators. Carm1-deficient cells showed a dramatic reduction in the expression level of c-Fos target genes MMP-1b, -3, and -13, indicating a major role for CARM1 in regulating the expression of these genes. RNA interference combined with quantitative polymerase chain reaction demonstrated that CARM1 and p160 proteins synergize to activate expression of MMP-1b, -3, and -13 in vivo. Furthermore, we show that CARM1 also regulates MMP expression at the post-transcriptional level, either positively or negatively. Our data indicate that CARM1 can play a dual role in the expression of AP-1 target genes involved in cancer or other diseases by acting at the transcriptional as well as at the post-transcriptional levels.