Fibroblast growth factor receptor-3 (FGFR-3) expression in the developing intestine is restricted to the undifferentiated epithelial cells within the lower portion of the crypt. We previously showed that mice lacking functional FGFR-3 have a significant decrease in the number of Paneth cells in the small intestine. Here, we used Caco2 cells to investigate whether FGFR-3 signaling can directly modulate expression of Paneth cell differentiation markers through its effects on TCF4/β-catenin or through other signaling pathways downstream of this receptor. Caco2 cells treated with FGFR-3 ligands or expressing FGFR-3(K650E), a constitutively active mutant, resulted in a significantly increased expression of genes characteristic of mature Paneth cells, including human α-defensins 5 and 6 (HD5 and HD6) and Paneth cell lysozyme, whereas enterocytic differentiation markers were reduced. Activation of FGFR-3 signaling sustained high levels of β-catenin mRNA expression, leading to increased TCF4/β-catenin-regulated transcriptional activity in Caco2 cells. Sustained activity of the TCF4/β-catenin pathway was required for the induction of Paneth cell markers. Activation of the MAPK pathway by FGFR-3 is also required for the induction of Paneth cell markers in addition to and independent of the effect of FGFR-3 on TCF4/β-catenin activity. These studies suggest that coordinate activation of multiple independent signaling pathways downstream of FGFR-3 is involved in regulation of Paneth cell differentiation.