Links between signal transduction, transcription and adhesion in epithelial bud development

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Abstract
The morphogenesis of organs as diverse as lungs, teeth and hair follicles is initiated by a downgrowth from a layer of epithelial stem cells1,2. During follicular morphogenesis, stem cells form this bud structure by changing their polarity and cell–cell contacts. Here we show that this process is achieved through simultaneous receipt of two external signals: a Wnt protein to stabilize β-catenin, and a bone morphogenetic protein (BMP) inhibitor to produce Lef1. β-Catenin then binds to, and activates, Lef1 transcription complexes that appear to act uncharacteristically by downregulating the gene encoding E-cadherin, an important component of polarity and intercellular adhesion. When either signal is missing, functional Lef1 complexes are not made, and E-cadherin downregulation and follicle morphogenesis are impaired. In Drosophila, E-cadherin can influence the plane of cell division and cytoskeletal dynamics3. Consistent with this notion, we show that forced elevation of E-cadherin levels block invagination and follicle production. Our findings reveal an intricate molecular programme that links two extracellular signalling pathways to the formation of a nuclear transcription factor that acts on target genes to remodel cellular junctions and permit follicle formation.