Targeting protein kinase C (PKC) isoforms by the small molecule inhibitor enzastaurin has shown promising preclinical activity in a wide range of tumor cells. We further delineated its mechanism of action in multiple myeloma (MM) cells and found a novel role of beta-catenin in regulating growth and survival of tumor cells. Specifically, inhibition of PKC leads to rapid accumulation of beta-catenin by preventing the phosphorylation required for its proteasomal degradation. Microarray analysis and small-interfering RNA (siRNA)-mediated gene silencing in MM cells revealed that accumulated beta-catenin activates early endoplasmic reticulum stress signaling via eIF2alpha, C/EBP-homologous protein (CHOP), and p21, leading to immediate growth inhibition. Furthermore, accumulated beta-catenin contributes to enzastaurin-induced cell death. Sequential knockdown of beta-catenin, c-Jun, and p73, as well as overexpression of beta-catenin or p73 confirmed that accumulated beta-catenin triggers c-Jun-dependent induction of p73, thereby conferring MM cell apoptosis. Our data reveal a novel role of beta-catenin in endoplasmic reticulum (ER) stress-mediated growth inhibition and a new proapoptotic mechanism triggered by beta-catenin on inhibition of PKC isoforms. Moreover, we identify p73 as a potential novel therapeutic target in MM. Based on these and previous data, enzastaurin is currently under clinical investigation in a variety of hematologic malignancies, including MM.