During normal development progenitor cells of many tissues undergo progressive restriction of pluripotency, epithelial-to-mesenchymal transition, proliferation, migration, and differentiation. Most, if not all, of these events involve modifications of cell-cell and cell-matrix adhesion, and abnormal modifications of these adhesion systems are often associated with the formation of tumors. The Eph family of receptor tyrosine kinases and their ligands, the ephrins, are frequently over-expressed in a wide variety of cancers, including breast, small-cell lung and gastrointestinal cancers, melanomas, and neuroblastomas. Using the Xenopus embryonic system, we have demonstrated that signaling mediated by the intracellular domain of ephrinB affects cell-cell adhesion, and that this activity can be modulated by interaction with an activated FGF receptor. The transmembrane ephrinB1 protein is a bi-directional signaling molecule that signals through its cytoplasmic domain to promote cellular movements into the eye field, whereas activation of the fibroblast growth factor receptor (FGFR) represses these movements and retinal fate. In Xenopus embryos, ephrinB1 plays a role in retinal progenitor cell movement into the eye field through an interaction with the scaffold protein Dishevelled (Dsh). However, the mechanism by which the FGFR may regulate this cell movement is unknown. Here we present evidence that FGFR-induced repression of retinal fate is dependent upon phosphorylation within the intracellular domain of ephrinB1. We demonstrate that phosphorylation of tyrosines 324 and 325 within ephrinB1 disrupts the ephrinB1/Dsh interaction, thus modulating retinal progenitor movement that is dependent on the planar cell polarity (PCP) pathway. These results provide mechanistic insight into how FGF signaling modulates ephrinB1 control of retinal progenitor movement within the eye field. Moreover, we found evidence that ephrinB1 signaling may regulate cell-cell junctions through a cell polarity complex in vivo. This study focused on assessing whether ephrinB1 is a mediator or modulator of cell-cell junction signaling in epithelial cells using the Xenopus system. We presented evidence that the Par polarity complex protein, Par-6, which is a major scaffold protein required for establishing tight junctions, associates with ephrinB1 and is regulated by ephrinB1, resulting in the control of tight junctions. Using the epithelial cells of early stage Xenopus embryos, we showed that loss- or gain-of function of ephrinB1 can disrupt cell-cell contacts and tight junctions. This study reveals a mechanism where ephrinB1 competes with active Cdc42 for binding to Par-6, a scaffold protein central to the Par polarity complex (Par-3/Par-6/Cdc42/aPKC) and disrupts the localization of tight junction-associated proteins (ZO-1, Cingulin). This competition affects formation of tight junctions, and is regulated by tyrosine phosphorylation of ephrinB1.