Wnts are secreted proteins important to many biological processes. frizzled genes encode a family of Wnt receptors that signal to the intracellular compartment through the cytosolic protein Disheveled. Limited information is available concerning the regulation of Frizzleds at a biochemical level. We report here that Xenopus Frizzled-3 is phosphorylated in a Disheveled-dependent manner that appears to require the DEP domain of Disheveled. Phosphorylation of serine 576 causes a decrease in electrophoretic mobility and accounts for a significant fraction of receptor phosphorylation, although additional residues in the C-terminal tail are also phosphorylated. In addition, mutations that interfere with Frizzled-3 function also interfere with phosphorylation, but these inactive mutants can be phosphorylated when an active form of Frizzled-3 is co-expressed. Mutation of C-terminal serines including serine 576 significantly enhances Frizzled-3-mediated induction of neural crest markers, suggesting that C-terminal phosphorylation plays a role in down-regulating Frizzled signaling.