beta-Catenins function both in cell adhesion as part of the cadherin/catenin complex and in Wnt signal transduction as transcription factors. Vertebrates express two related proteins, beta-catenin and plakoglobin, while Drosophila has a single family member, Armadillo. Caenorhabditis elegans expresses three beta-catenin-related proteins, BAR-1, HMP-2, and WRM-1, which are quite diverged in sequence from each other and other beta-catenins. While BAR-1 and WRM-1 are known to act in Wnt-mediated processes, and HMP-2 acts in a complex with cadherin/alpha-catenin homologs, it is unclear whether all three proteins retain the other functions of beta-catenin. Here we show that BAR-1, like vertebrate beta-catenin, has redundant transcription activation domains in its amino- and carboxyl-terminal regions but that HMP-2 and WRM-1 also possess the ability to activate transcription. We show via yeast two-hybrid analysis that these three proteins display distinct patterns of protein interactions. Surprisingly, we find that both WRM-1 and HMP-2 can substitute for BAR-1 in C. elegans when expressed from the bar-1 promoter. Therefore, although their mutant phenotypes and protein interaction patterns strongly suggest that the functions of beta-catenin in other species have been segregated among three diverged proteins in C. elegans, these proteins still retain sufficient similarity to display functional redundancy in vivo.