Background: Vertebrate cranial neural crest cells (CNCCs) are multipotent, proximal to the source CNCC form the cranial ganglia. Distally, in the pharyngeal arches, they give rise to the craniofacial skeleton and connective tissues. Fate choices are made as CNCC pattern into distinct destination compartments. In spite of this importance, the mechanism patterning CNCC is poorly defined. Results: Here, we report that a novel β-catenin-dependent regulation of N-Cadherin levels may drive CNCC patterning. In mouse embryos, at the first pharyngeal arch axial level, membrane β-catenin levels correlate with the extent of N-cadherin-mediated adhesion and thus suggest the presence of collective and dispersed states of CNCC. Using in vitro human neural crest model and chemical modulators of β-catenin levels, we show a requirement for down-modulating β-catenin for regulating N-cadherin levels and cell-cell adhesion. Similarly, in β-catenin gain-of-function mutant mouse embryos, CNCC fail to lower N-cadherin levels. This indicates a failure to reduce cell-cell adhesion, which may underlie the failure of mutant CNCC to populate first pharyngeal arch. Conclusion: We suggest that β-catenin-mediated regulation of CNCC adhesion, a previously underappreciated mechanism, underlies the patterning of CNCC into fate-specific compartments.