Dickkopf-1 (Dkk1) is a secreted Wnt antagonist with a well-established role in head induction during development. Numerous studies have emerged implicating Dkk1 in various malignancies and neurodegenerative diseases through an unknown mechanism. Using zebrafish gastrulation as a model for collective cell migration, we unveil such a mechanism, identifying a role for Dkk1 in control of cell connectivity and polarity in vivo, independent of its known function. We find that Dkk1 localizes to adhesion complexes at the plasma membrane and regions of concentrated actomyosin, suggesting a direct involvement in regulation of local cell adhesion. Our results show that Dkk1 represses cell polarization and integrity of cell-cell adhesion, independently of its impact on ?-catenin protein degradation. Concurrently, Dkk1 prevents nuclear localization of ?-catenin by restricting its distribution to a discrete submembrane pool. We propose that redistribution of cytosolic ?-catenin by Dkk1 concomitantly drives repression of cell adhesion and inhibits ?-catenin-dependent transcriptional output.