Wnt signaling pathways are tightly regulated by ubiquitination, and dysregulation of these pathways promotes tumorigenesis. It has been reported that the ubiquitin ligase RNF43 plays an important role in frizzled-dependent regulation of the Wnt/β-catenin pathway. Here, we show that RNF43 suppresses both Wnt/β-catenin signaling and noncanonical Wnt signaling by distinct mechanisms. The suppression of Wnt/β-catenin signaling requires interaction between the extracellular protease-associated (PA) domain and the cysteine-rich domain (CRD) of frizzled and the intracellular RING finger domain of RNF43. In contrast, these N-terminal domains of RNF43 are not required for inhibition of noncanonical Wnt signaling, but interaction between the C-terminal cytoplasmic region of RNF43 and the PDZ domain of dishevelled is essential for this suppression. We further show the mechanism by which missense mutations in the extracellular portion of RNF43 identified in patients with tumors activate Wnt/β-catenin signaling. Missense mutations of RNF43 change their localization from the endosome to the endoplasmic reticulum (ER), resulting in the failure of frizzled-dependent suppression of Wnt/β-catenin signaling. However, these mutants retain the ability to suppress noncanonical Wnt signaling, probably due to interaction with dishevelled. RNF43 is also one of the potential target genes of Wnt/β-catenin signaling. Our results reveal the molecular role of RNF43 and provide an insight into tumorigenesis.