A major outcome of the canonical Wnt/beta-catenin-signalling pathway is the transcriptional activation of a specific set of target genes. A typical feature of the transcriptional response induced by Wnt signalling is the involvement of Tcf/Lef factors that function in the nucleus as the principal mediators of signalling. Vertebrate Tcf/Lef proteins perform two well-characterized functions: in association with beta-catenin they activate gene expression, and in the absence of Wnt ligands they bind TLE/Groucho proteins to act as transcriptional repressors. Although the general characteristics of Tcf/Lef factors are well understood, the mechanisms that control their specific roles in various cellular backgrounds are much less defined. In this report we reveal that the evolutionary conserved Dazap2 protein functions as a TCF-4 interacting partner. We demonstrate that a short region proximal to the TCF-4 HMG box mediates the interaction and that all Tcf/Lef family members associate with Dazap2. Interestingly, knockdown of Dazap2 not only reduced the activity of Wnt signalling as measured by Tcf/beta-catenin reporters but additionally altered the expression of Wnt-signalling target genes. Finally, chromatin immunoprecipitation studies indicate that Dazap2 modulates the affinity of TCF-4 for its DNA-recognition motif.