Inactivation of the Adenomatous Polyposis Coli (APC) tumor suppressor triggers the development of most colorectal carcinomas. APC is required for targeted degradation of beta-catenin, the central transcriptional activator in the Wnt/Wingless (Wg) signal transduction pathway; however, the precise biochemical functions of APC remain uncertain. The two Drosophila homologs of APC (Apc1 and Apc2) appear to have predominantly different tissue distributions, different subcellular localizations and mutually exclusive phenotypes upon inactivation. Unexpectedly, we have found that despite these differences, simultaneous reduction in both Drosophila Apc proteins results in the global nuclear accumulation of beta-catenin and the constitutive activation of Wg transduction throughout development. This redundancy extends even to functions previously thought to be specific to the individual Apc homologs. Together, these results reveal that the combined activity of Apc1 and Apc2 allows a tight regulation of transcriptional activation by beta-catenin and suggest that APC proteins are required for the regulation of Wnt transduction in all cells.