Cadmium is a heavy metal that has multiple toxic effects on human health and has been classified as a human carcinogen. E-cadherin is a major target of cadmium; however, the roles of E-cadherin and cadmium and the mechanisms of tumor progression remain to be defined. Here, we demonstrate that cadmium increases E-cadherin processing via a γ-secretase in the T47D breast cancer cell lines. This presenilin 1 (PS1)/γ-secretase–dependent cleavage of E-cadherin was accompanied by changes in reactive oxygen species or calcium. E-cadherin cleavage was blocked by a PS1 dominant-negative mutant, γ-secretase inhibitors [N-[N-(3,5-Difluorophenacetyl-L-alanyl)]-S-phenylglycine t-butyl ester (DAPT) and L-685,486], antioxidants (N-acetylcysteine and Mn(III)tetrakis(1-methyl-4-pyridyl)porphyrin pentachloride), or a calcium chelating drug 1,2-bis(o-Aminophenoxy)ethane-N,N,N′,N′-tetraacetic acid tetra(acetoxymethyl) ester. Immunofluorescence analysis confirmed the disappearance of E-cadherin staining at the cell surface. Those inhibitors attenuated cadmium-induced cytotoxicity. Additionally, cadmium treatment increased cell motility and invasion ability, which was abated by DAPT. Interestingly, cyclooxygenase-2 (COX-2) expression induced by cadmium was also inhibited by DAPT. The cadmium-induced cell motility and invasion ability were inhibited by a COX-2 inhibitor, NS398. Our data indicate a novel molecular mechanism that links cytotoxicity of cadmium and disrupted E-cadherin processing to adherens junctions; cadmium induces COX-2 expression via γ-secretase, which increases cell motility and invasion ability. Understanding the downstream signaling cascades of cadmium that promote tumor progression might be a key to the development of novel therapeutic strategies.