Background: Guanylyl Cyclase C (GCC) signaling via uroguanylin (UGN) and guanylin activation is a critical mediator of intestinal fluid homeostasis, intestinal cell proliferation/apoptosis, and tumorigenesis. As a mechanism for some of these effects, we hypothesized that GCC signaling mediates regulation of intestinal barrier function. Methodology/Principal Findings: Paracellular permeability of intestinal segments was assessed in wild type (WT) and GCC deficient (GCC-/-) mice with and without lipopolysaccharide (LPS) challenge, as well as in UGN deficient (UGN-/-) mice. IFNc and myosin light chain kinase (MLCK) levels were determined by real time PCR. Expression of tight junction proteins (TJPs), phosphorylation of myosin II regulatory light chain (MLC), and STAT1 activation were examined in intestinal epithelial cells (IECs) and intestinal mucosa. The permeability of Caco-2 and HT-29 IEC monolayers, grown on Transwell filters was determined in the absence and presence of GCC RNA interference (RNAi).We found that intestinal permeability was increased in GCC-/-and UGN-/-mice compared to WT, accompanied by increased IFNc levels, MLCK and STAT1 activation in IECs. LPS challenge promotes greater IFNc and STAT1 activation in IECs of GCC-/-mice compared to WT mice. Claudin-2 and JAM-A expression were reduced in GCC deficient intestine; the level of phosphorylated MLC in IECs was significantly increased in GCC-/- and UGN-/- mice compared to WT. GCC knockdown induced MLC phosphorylation, increased permeability in IEC monolayers under basal conditions, and enhanced TNFα and IFNγ-induced monolayer hyperpermeability. Conclusions/Significance: GCC signaling plays a protective role in the integrity of the intestinal mucosal barrier by regulating MLCK activation and TJ disassembly. GCC signaling activation may therefore represent a novel mechanism in maintaining the small bowel barrier in response to injury. © 2011 Han et al.