Much of the Hippo and planar cell polarity (PCP) signaling mediated by the Drosophila protocadherin Fat depends on its ability to change the subcellular localization, levels and activity of the unconventional myosin Dachs. To better understand this process, we have performed a structure-function analysis of Dachs, and used this to identify a novel and important mediator of Fat and Dachs activities, a Dachs-binding SH3 protein we have named Dlish. We found that Dlish is regulated by Fat and Dachs, that Dlish also binds Fat and the Dachs regulator Approximated, and that Dlish is required for Dachs localization, levels and activity in both wild type and fat mutant tissue. Our evidence supports dual roles for Dlish. Dlish tethers Dachs to the subapical cell cortex, an effect partly mediated by the palmitoyltransferase Approximated under the control of Fat. Conversely, Dlish promotes the Fat-mediated degradation of Dachs.