Loss of function of the E-cadherin gene (CDH1) has been linked with diffuse gastric cancer susceptibility, and germline inactivating mutations in CDH1 characterise the hereditary diffuse gastric cancer (HDGC) syndrome. Hypermethylation in the CDH1 promoter region is a frequent phenomenon in poorly differentiated, diffuse gastric carcinomas and it was identified as the main mechanism for the inactivation of the remaining wild-type allele in HDGC cases. Specific criteria are used to identify patients with suspected HDGC and who should be investigated for CDH1 germline mutations. Accurate screening is mandatory for unaffected carriers of CDH1 mutations and selected high-risk individuals could be considered for prophylactic gastrectomy. Also, germline CDH1 mutations may predispose to lobular breast carcinoma and prostate cancer. Germline CDH1 mutations are not always detectable in patients who meet the HDGC criteria and the aetiological role of this gene is still under investigation. Families without recognised inactivating CDH1 mutations may have undisclosed CDH1 mutations or mutations in its regulatory sequences or germline mutations in unidentified genes that also contribute to the disease. In recent years, several germline missense CDH1 mutations have been identified, some of which showed a marked negative influence on E-cadherin function in experimental models. CDH1 promoter hypermethylation seems a key event in the carcinogenetic process of poorly differentiated, diffuse gastric cancer and it deserves further investigation as a new target for anticancer therapies with demethylating agents.