The small GTPase Cdc42 is an essential signaling molecule in multiple cellular processes, including proliferation, migration, division and apoptosis. The overexpression of Cdc42 is found in certain breast carcinomas, bringing to question its roles in normal mammary cell function and during breast cancer progression. In this thesis, I have examined the roles of Cdc42 during mammary gland development, and then analyzed the effects of overactive Cdc42 signaling on mammary epithelial cells (MECs). To accomplish this, I used an in vivo mouse model as well as primary cell culture systems. In the initial study, the conditional-knockout of Cdc42 in the epithelia of adult mouse mammary glands resulted in the altered cellular localization of Par complex members, as well as E-cadherin. These changes accompanied a disorganization of the epithelial cells within the mammary gland, and led to insufficient lactation. This loss-of-function mouse model showed that Cdc42 is essential for the proper maintenance of both apical-basal cell polarity and E-cadherin-based cell-cell junctions in the adult mammary gland. These results raised further interest concerning the roles Cdc42 may have in breast carcinoma development, in which proper apical-basal cell polarity and cell-cell communication are commonly lost. I next examined the effects of aberrant Cdc42 signaling in primary MECs by utilizing the constitutively-active Cdc42[F28L] mutant. In a monolayer culture system, Cdc42[F28L] stimulated the formation of actin-based stress fibers, and gave rise to multi-nucleated cells, while in a three-dimensional model system it drove the primary MECs toward an invasive phenotype in an IQGAP1-dependent manner. The primary MECs expressing Cdc42[F28L] lost the proper localization of E-cadherin at cell-cell contacts and no longer formed normal, hollowed alveolar lumens, but instead began to abnormally fill the luminal space and invade out into the surrounding environment. A common phenotype exhibited by these model systems was the proper maintenance of E-cadherin-based cell-cell contacts between mammary epithelial cells. Interestingly, both the deletion of Cdc42 and its constitutive activation resulted in abnormal E-cadherin expression and localization within mammary epithelial cells. IQGAP1 is likely the primary Cdc42 effector responsible for these phenotypes, as it can both regulate E-cadherin stability at cell-cell junctions as well as bundle microtubules at the leading edge of invasive cells. These studies suggest IQGAP1 is a critical signaling effector of Cdc42 in adult mammary epithelial cells and that, when not properly regulated, it can shift the epithelia toward an invasive phenotype.