Fbw7 and Cdh1 are substrate-recognition subunits of the SCF- and APC-type E3 ubiquitin ligases, respectively. There is emerging evidence suggesting that both Fbw7 and Cdh1 function as tumor suppressors by targeting oncoproteins for destruction. Loss of Fbw7, but not Cdh1, is frequently observed in various human tumors. However, it remains largely unknown how Fbw7 mechanistically functions as a tumor suppressor and whether there is a signaling crosstalk between Fbw7 and Cdh1. Here, we report that Fbw7-deficient cells not only display elevated expression levels of SCF(Fbw7) substrates, including cyclin E, but also have increased expression of various APC(Cdh1) substrates. We further defined cyclin E as the critical signaling link by which Fbw7 governs APC(Cdh1) activity, as depletion of cyclin E in Fbw7-deficient cells results in decreased expression of APC(Cdh1) substrates to levels comparable to those in wild-type (WT) cells. Conversely, ectopic expression of cyclin E recapitulates the aberrant APC(Cdh1) substrate expression observed in Fbw7-deficient cells. More importantly, 4A-Cdh1 that is resistant to Cdk2/cyclin E-mediated phosphorylation, but not WT-Cdh1, reversed the elevated expression of various APC(Cdh1) substrates in Fbw7-deficient cells. Overexpression of 4A-Cdh1 also resulted in retarded cell growth and decreased anchorage-independent colony formation. Altogether, we have identified a novel regulatory mechanism by which Fbw7 governs Cdh1 activity in a cyclin E-dependent manner. As a result, loss of Fbw7 can lead to aberrant increase in the expression of both SCF(Fbw7) and APC(Cdh1) substrates. Our study provides a better understanding of the tumor suppressor function of Fbw7, and suggests that Cdk2/cyclin E inhibitors could serve as effective therapeutic agents for treating Fbw7-deficient tumors.