The airway epithelium plays a role in immune regulation during environmental challenge, which is intertwined with its barrier function and capacity to limit submucosal access of environmental factors. In asthma, mucosal barrier function is often compromised, with disrupted expression of the adhesion molecule E-cadherin. Recent progress suggests that E-cadherin contributes to the structural and immunological function of airway epithelium, through the regulation of epithelial junctions, proliferation, differentiation, and production of growth factors and proinflammatory mediators that can modulate the immune response. Here, we discuss this novel role for E-cadherin in mediating the crucial immunological decision between maintenance of tolerance versus induction of innate and adaptive immunity.