Vascular endothelial (VE)-cadherin is the endothelium-specific member of the cadherin family of homotypic cell adhesion molecules. VE-cadherin, but not the cell adhesion molecule platelet/endothelial cell adhesion molecule (PECAM-1), markedly colocalizes with actin stress fibers at cell-cell junctions between human umbilical vein endothelial cells. Inhibition of VE-cadherin-mediated, but not PECAM-1-mediated, adhesion induced reorganization of the actin cytoskeleton, loss of junctional VE-cadherin staining and loss of cell-cell adhesion. In functional assays, inhibition of VE-cadherin caused increased monolayer permeability and enhanced neutrophil transendothelial migration. In a complementary set of experiments, modulation of the actin cytoskeleton was found to strongly affect VE-cadherin distribution. Brief stimulation of the beta2-adrenergic receptor with isoproterenol induced a loss of actin stress fibers resulting in a linear, rather than 'jagged', VE-cadherin distribution. The concomitant, isoproterenol-induced, reduction in monolayer permeability was alleviated by a VE-cadherin-blocking antibody. Finally, cytoskeletal reorganization resulting from the inactivation of p21Rho caused a diffuse localization of VE-cadherin, which was accompanied by reduced cell-cell adhesion. Together, these data show that monolayer permeability and neutrophil transendothelial migration are modulated by VE-cadherin-mediated cell-cell adhesion, which is in turn controlled by the dynamics of the actin cytoskeleton.