Metastatic melanoma cells are highly adaptable to their in vivo microenvironment and can switch between protease-dependent mesenchymal and protease-independent amoeboid invasion to facilitate metastasis. Such adaptability can be visualized in vitro, when cells are cultured in conditions that recapitulate three-dimensional microenvironments. Using thick collagen layers in cell culture and in vivo extravasation assays, we found that pigment epithelium-derived factor (PEDF) suppressed lung extravasation of aggressive melanoma by coordinated regulation of cell shape and proteolysis. In cells grown on a thick collagen bed, PEDF overexpression and exogenous PEDF blocked the rapidly invasive, rounded morphology, and promoted an elongated, mesenchymal-like phenotype associated with reduced invasion. These changes in cell shape depended on decreased RhoA and increased Rac1 activation and were mediated by the up-regulation of Rac1-GEF, DOCK3 and down-regulation of Rac1-GAP, ARHGAP22. Surprisingly, we found that PEDF overexpression also blocked the trafficking of membrane-tethered, MT1-MMP to the cell surface through RhoA inhibition and Rac1 activation. In vivo, knockdown of Rac1 and DOCK3 or overexpression of MT1-MMP was sufficient to reverse the inhibitory effect of PEDF on extravasation. Using functional studies, we demonstrated that PEDF suppressed the rounded morphology and MT1-MMP surface localization through its antiangiongenic, 34-mer epitope and the recently identified PEDF receptor candidate, PNPLA2. Our findings unveil the coordinated regulation of cell shape and proteolysis and identify an unknown mechanism for PEDF's antimetastatic activity.