beta-Catenin and plakoglobin are related proteins involved in the regulation of adherens junctions and desmosomes. Moreover, by binding to Tcf-4, they can act as transcriptional modulators of genes involved in embryonic development and tumorigenesis. However, they associate to distinct Tcf-4 subdomains causing opposing effects on Tcf-4 binding to DNA: whereas beta-catenin does not affect this binding, plakoglobin prevents it. Both proteins are composed by two N- and C-tails and a central armadillo repeat domain. Interaction of Tcf-4, as well as other desmosomal or adherens junction components, with beta-catenin or plakoglobin takes place through the central armadillo domain. Here we show that, as reported for beta-catenin, plakoglobin terminal tails also interact with the central domain and regulate the ability of this region to bind to different cofactors. Moreover the specificity of the interaction of beta-catenin and plakoglobin with different subdomains in Tcf-4 or with other junctional components resides within the terminal tails and not in the armadillo domain. For instance, a chimeric protein in which the central domain of beta-catenin was replaced by that of plakoglobin presented the same specificity as wild-type beta-catenin. Therefore, the terminal tails of these proteins are responsible for discerning among binding of factors to the armadillo domain. These results contribute to the understanding of the molecular basis of the interactions established by these key regulators of epithelial tumorigenesis.