The Neurofibromatosis-2 (NF2) tumor suppressor merlin negatively regulates cell proliferation in numerous cell types. We have previously shown that the NF2 protein (merlin/schwannomin) associates with mixed lineage kinase 3 (MLK3), a mitogen-activated protein kinase (MAPK) kinase kinase that is required for the proliferation of normal and neoplastic cells. In this study, we show that merlin inhibits MLK3 activity, as well as the activation of its downstream effectors, B-Raf, extracellular signal-regulated kinase (ERK) and c-Jun N-terminal kinase (JNK). The ability of merlin to regulate MLK3 activity requires a direct association between MLK3 and residues in the C-terminal region of merlin. Merlin integrates Rho GTPase family signaling with MAPK activity by inhibiting the binding between MLK3 and its upstream activator, Cdc42. Furthermore, we demonstrate that MLK3 is required for merlin-mediated suppression of cell proliferation and invasion. Collectively, these results establish merlin as a potent inhibitor of MLK3, ERK and JNK activation in cancer, and provide a mechanistic link between deregulated MAPK and Rho GTPase signaling in NF2 growth control.