Tissue development and maintenance rely upon choreographed cell signaling, dynamic cell-cell and cell-matrix interactions, and a precise interplay between the matrix and the cells to promote intercellular organization, differentiation, and cell survival. Epithelial cancer progression is generally the result of the deregulation of these processes, and is accompanied by the disruption of epithelial architecture. The emergence of three-dimensional (3D) cell models has led to a deeper understanding of tissue-specific behaviors by modeling both physiological events as well as the progression of disease states. Here, we contribute to the understanding of the role of ARF6 in epithelial tissue morphogenesis by utilizing 3D basement membrane cultures that model glandular architecture and its microenvironment. We demonstrate that renal epithelial cysts require ARF6 to orient cellular polarity and to deliver and assemble Laminin into a supportive basement membrane network. Cellular depletion of ARF6 expression results in the formation of inverted glandular units, although individual cell polarity remains unperturbed. This inversion is accompanied by an inability to activate Rac1 at critical time points in cystogenesis and a failure to deposit Laminin. The activation of Rac1, in a time dependent manner, is sufficient to recover a normal cyst phenotype, as well as a proper distribution of Laminin to support cyst development. Both, Rac1-activation and Laminin-deposition occur in concert with matrix remodeling induced by Matrix Metalloproteinases. When ARF6 expression is knocked down in unnatural environments, such as collagen I matrix, the resulting cysts exhibit an altered polarity coupled with an enhanced capacity to adhere to and constrict the non-native matrix microenvironment. Thus, the cellular microenvironment appears to markedly influence the glandular phenotype induced upon ARF6 depletion. Finally, ARF6 depletion inhibits tubule initiation from renal cysts exposed to growth factors such HGF, confirming a role for ARF6 in the early stages of tubule formation. The ARF6 knockdown phenotypes described here, model histological phenotypes found in a number of human diseases, particularly in invasive cancers. We believe that the role of ARF6 in regulating epithelial morphogenesis could be extrapolated to investigate tissue events associated with epithelial cancer progression from invasion to metastasis.