The Krüppel-like zinc-finger protein GLI1 functions as a downstream transcription factor of Hedgehog signaling and plays a pivotal role in the cellular proliferation of many types of tumors, including pancreatic ductal adenocarcinoma (PDA). PDA develops from dysplastic lesions called pancreatic intraepithelial neoplasia (PanIN) through a multistep carcinogenesis process that changes its cellular characteristics, including a mucin expression profile. Increased expression of a gel-forming mucin, MUC5AC, was previously revealed as a major biomarker for the poor prognosis of PDA patients, but the molecular mechanisms responsible for its expression and correlation with poor prognosis are not fully understood. Here we show that MUC5AC is a direct transcriptional target of GLI1 in PDA cells. Overexpression of GLI1 enhanced MUC5AC expression, and a double knockdown of GLI1 and GLI2 suppressed endogenous MUC5AC expression in PDA cells. Luciferase reporter assays revealed that GLI1 and GLI2 can activate the MUC5AC promoter through its conserved CACCC-box-like cis-regulatory elements. We also found that GLI1-upregulated MUC5AC was expressed in the intercellular junction between cultured PDA cells and interfered with the membrane localization of E-cadherin, leading to decreased E-cadherin-dependent cell-cell adhesion and promoting the migration and invasion of PDA cells. Consistently, GLI1 induced the nuclear accumulation and target gene expression of β-catenin in a MUC5AC-dependent manner. Finally, immunohistochemical analysis revealed that GLI1 expression statistically correlated with MUC5AC expression and also with altered subcellular localization of E-cadherin and β-catenin in PanIN lesions and PDA. This evidence revealed a new aspect of GLI1 function in modulating E-cadherin/β-catenin-regulated cancer cell properties through the expression of a gel-forming mucin.