Transforming growth factor-β (TGF-β) induces the expression of Disabled-2 (Dab2), an endocytic adaptor and tumour suppressor, concomitant with the induction of an epithelial-mesenchymal transition (EMT) in mammary epithelial cells. Here we show that following TGF-β-mediated EMT, sustained TGF-β treatment leads to proteolytic degradation of Dab2 by cathepsin B (CTSB), loss of the mesenchymal phenotype and induction of autophagy. CTSB inhibition or expression of a CTSB-resistant Dab2 mutant maintains Dab2 expression and shifts long-term TGF-β-treated cells from autophagy to apoptosis. We further show that Dab2 interacts with Beclin-1 to promote casein-kinase-2-mediated phosphorylation of Beclin-1, preventing Beclin-1-Vps34 interaction and subsequent autophagosome assembly. Thus, CTSB-mediated degradation of Dab2 allows Beclin-1-Vps34 induction of autophagy, whereas sustained Dab2 expression prevents autophagy and promotes apoptosis by stabilizing the pro-apoptotic Bim protein. In vivo studies suggest that Dab2-mediated regulation of autophagy modulates chemotherapeutic resistance and tumour metastasis.