Low expression levels of E-cadherin are correlated with poor prognosis in patients with bladder cancer (BCa). A small activating RNA (saRNA) targeting a specific promoter region can activate gene expression. In the present study, two small double-stranded RNAs (dsRNAs) targeting the promoter region of human E-cadherin were designed and synthesized, and the regulatory role of saRNAs in E-cadherin expression was investigated. The results of reverse transcription-quantitative polymerase chain reaction and western blotting demonstrated that transfection of dsEcad-346 into the BCa cell lines T24 and 5637 significantly activated E-cadherin expression. Furthermore, transfection of dsEcad-346 and miR-373 induced cell cycle arrest in G0/G1 phase, promoted apoptosis and significantly inhibited migration and invasion of BCa cells. Results of immunofluorescence and western blotting indicated that beta-catenin was redistributed from the nucleus to the cell membrane following transfection of dsEcad-346 and miR-373. Additionally, the expression of beta-catenin/T-cell factor complex (TCF) target genes (c-MYC, matrix metallopeptidase 2, cyclin D1) was suppressed following transfection of BCa cells with saRNA. Silencing of E-cadherin expression blocked the inhibitory effect of dsEcad-346 and miR-373 on BCa cells. In conclusion, a novel designed dsEcad-346 can activate the expression of E-cadherin in BCa cells. saRNA-mediated activation of E-cadherin expression inhibited the growth and metastasis of BCa cells by promoting the redistribution of beta-catenin from nucleus to cell membrane and inhibiting the beta-catenin/TCF target genes.