An XWnt8-Fz5 fusion protein synergizes with LRP6 to potently activate P-catenin-dependent signaling. Here, we generated a fusion in which XWnt8 was fused to the N-terminus of LRP6 and show it synergizes with both Fz4 and Fz5 to potently transactivate beta-catenin-dependent Wnt signaling. Based on this, we hypothesized that the main function of Wnt is to nucleate the formation of a physical complex between LRP6 and a Frizzled. Dkk1, but not the related Dkk3, binds LRP6 and inhibits canonical Wnt signaling by blocking the interaction of Wnt and LRP6. Therefore, we reasoned that a covalent fusion of Dkk1 to Fz5 (Dkk1-Fz5) would mimic Wnt ligand by nucleating the formation of a complex containing Fz5 and LRP6, while Dkk3 (Dkk3-Fz5) would not. We found that Dkk1-Fz5, but not Dkk3-Fz5, potently synergized with LRP6 to activate signaling in a dishevelled-dependent manner. (C) 2005 Elsevier Inc. All rights reserved.