We have developed a model system for studying integrin regulation of mammalian epithelial tubule formation. Application of collagen gel overlays to Madin-Darby canine kidney (MDCK) cells induced coordinated disassembly of junctional complexes that was accompanied by lamellipodia formation and cell rearrangement (termed epithelial remodeling; 41). In this study we present evidence that the Rho signal transduction pathway regulates epithelial remodeling and tubule formation. Incubation of MDCK cells with collagen gel overlays facilitated formation of migrating lamellipodia with membrane-associated actin. Inhibitors of myosin II and actin prevented lamellipodia formation suggesting that actinomyosin function was involved in regulation of epithelial remodeling. To determine this, changes in myosin II distribution, function and phosphorylation were studied during epithelial tubule biogenesis. Myosin II co-localized with actin at the leading edge of lamellipodia providing evidence that myosin was important in epithelial remodeling. This possibility was supported by observations that inhibition of Rho-kinase, a regulator of myosin II function, altered formation of lamellipodia resulting in attenuated epithelial tubule development. These data and those demonstrating myosin regulatory light chain phosphorylation at the leading edge of lamellipodia strongly suggest that Rho-kinase and myosin II are important modulators of epithelial remodeling. They support a hypothesis that the Rho signal transduction pathway plays a significant role in regulation of epithelial tubule formation.