Loss of expression of the type III transforming growth factor-beta receptor (TbetaRIII or betaglycan), a transforming growth factor-beta (TGF-beta) superfamily co-receptor, is common in human breast cancers. TbetaRIII suppresses cancer progression in vivo by reducing cancer cell migration and invasion by largely unknown mechanisms. Here, we demonstrate that the cytoplasmic domain of TbetaRIII is essential for TbetaRIII-mediated downregulation of migration and invasion in vitro and TbetaRIII-mediated inhibition of breast cancer progression in vivo. Functionally, the cytoplasmic domain of TbetaRIII is required to attenuate TGF-beta signaling, whereas TbetaRIII-mediated attenuation of TGF-beta signaling is required for TbetaRIII-mediated inhibition of migration and invasion. Mechanistically, both TbetaRIII-mediated inhibition of TGF-beta signaling and TbetaRIII-mediated inhibition of invasion occur through the interaction of the cytoplasmic domain of TbetaRIII with the scaffolding protein GAIP-interacting protein C-terminus (GIPC). Taken together, these studies support a functional role for the TbetaRIII cytoplasmic domain interacting with GIPC to suppress breast cancer progression.