HB-EGF, a ligand for EGF receptors, is synthesized as a membrane-anchored precursor that is potentially capable of juxtacrine activation of EGF receptors. However, the physiological importance of such juxtacrine signaling remains poorly described, due to frequent inability to distinguish effects mediated by membrane-anchored HB-EGF vs. mature secreted HB-EGF. In our studies, using stable expression of a non-cleavable, membrane-anchored rat HB-EGF isoform (MDCK^rat5aa cells) in MDCK II cells, we observed a significant increase in trans-epithelial resistance (TER). Similar significant increases in TER were observed upon stable expression of an analogous non-cleavable, membrane-anchored human HB-EGF construct (MDCK^human5aa cells). The presence of non-cleavable, membrane-anchored HB-EGF led to alterations in the expression of selected claudin family members, including a marked decrease in claudin-2 in MDCK^rat5aa cells compared to the control MDCK cells. Re-expression of claudin-2 in MDCK^rat5aa cells largely prevented the increases in TER. Ion substitution studies indicated decreased paracellular ionic permeability of Na⁺ in MDCK^rat5aa cells, further indicating that the altered claudin-2 expression mediated the increased TER seen in these cells. In a Ca⁺⁺-switch model, increased phosphorylation of EGF receptor and Akt was observed in MDCKrat5aa cells compared to the control MDCK cells, and inhibition of these pathways inhibited TER specifically in MDCK^rat5aa cells. Therefore, we hypothesize that juxtacrine activation of EGFR by membrane-anchored HB-EGF may play an important role in the regulation of tight junction proteins and TER.