Human and mouse Cripto-1 (CR-1/Cr-1) proteins play an important role in mammary gland development and tumorigenesis. In this study, we examined the relationship between Cripto-1 and caveolin-1 (Cav-1), a membrane protein that acts as a tumor suppressor in the mammary gland. Cripto-1 was found to interact with Cav-1 in COS7 cells and mammary epithelial cells. Using EpH4 mouse mammary epithelial cells expressing Cr-1 (EpH4 Cr-1) or Cr-1 and Cav-1 (EpH4 Cr-1/Cav-1), we demonstrate that Cav-1 expression markedly reduced the ability of Cr-1 to enhance migration, invasion, and formation of branching structures in EpH4 Cr-1/Cav-1 cells as compared to EpH4 Cr-1 cells. Furthermore, coexpression of Cav-1 together with Cr-1 in EpH4 Cr-1/Cav-1 cells inhibited Cr-1-mediated activation of c-src and mitogen-activated protein kinase signaling pathways. Conversely, primary mammary epithelial cells isolated from Cav-1 null -/-/mouse mammary tumor virus-CR-1 transgenic animals showed enhanced motility and activation of mitogen-activated protein kinase and c-src as compared to Cav-1+/+/CR-1 mammary cells. Finally, mammary tumors derived from mouse mammary tumor virus-CR-1 mice showed a dramatic reduction of Cav-1 expression as compared to mammary tissue from normal FVB/N mice, suggesting that in vivo Cav-1 is down-regulated during the process of CR-1-mediated mammary tumorigenesis.