Myosin II-driven mechanical forces control epithelial cell shape and morphogenesis. In particular, the circumferential actomyosin belt, which is located along apical cell-cell junctions, regulates many cellular processes. Despite its importance, the molecular mechanisms regulating the belt are not fully understood. In this paper, we characterize Lulu2, a FERM (4.1 protein, ezrin, radixin, moesin) domain-containing molecule homologous to Drosophila melanogaster Yurt, as an important regulator. In epithelial cells, Lulu2 is localized along apical cell-cell boundaries, and Lulu2 depletion by ribonucleic acid interference results in disorganization of the circumferential actomyosin belt. In its regulation of the belt, Lulu2 interacts with and activates p114RhoGEF, a Rho-specific guanine nucleotide exchanging factor (GEF), at apical cell-cell junctions. This interaction is negatively regulated via phosphorylation events in the FERM-adjacent domain of Lulu2 catalyzed by atypical protein kinase C. We further found that Patj, an apical cell polarity regulator, recruits p114RhoGEF to apical cell-cell boundaries via PDZ (PSD-95/Dlg/ZO-1) domain-mediated interaction. These findings therefore reveal a novel molecular system regulating the circumferential actomyosin belt in epithelial cells.