The Wnt signaling cascade is a central regulator of cell fate determination during embryonic development, whose deregulation contributes to oncogenesis. Naked cuticle is the first Wnt-induced antagonist found in this pathway, establishing a negative-feedback loop that limits the Wnt signal required for early segmentation. In addition, Naked cuticle is proposed to function as a switch, acting to restrict classical Wnt signaling and to activate a second Wnt signaling pathway that controls planar cell polarity during gastrulation movements in vertebrates. Little is known about the biochemical function of Naked cuticle or its regulation. Here we report that PR72, a Protein Phosphatase type 2A regulatory subunit of unknown function, interacts both physically and functionally with Naked cuticle. We show that PR72, like Naked cuticle, acts as a negative regulator of the classical Wnt signaling cascade, establishing PR72 as a novel regulator of the Wnt signaling pathway. Our data provide evidence that the inhibitory effect of Naked cuticle on Wnt signaling depends on the presence of PR72, both in mammalian cell culture and in Xenopus embryos. Moreover, PR72 is required during early embryonic development to regulate cell morphogenetic movements during body axis formation.