Canonical Wnt signaling plays crucial roles during development and disease. How Wnt signaling is modulated in different in vivo contexts is currently not well understood. Here, we investigate the modulation of Wnt signaling in the posterior lateral line primordium (pLLP), a cohort of ∼100 cells that collectively migrate along the trunk of the zebrafish embryo. The pLLP comprises proliferative progenitor cells and organized epithelial cells that will form the mechanosensory organs of the posterior lateral line. Wnt signaling is active in the leading progenitor zone of the pLLP and restricted from the trailing zone through expression of the secreted Wnt inhibitors dkk1b and dkk2. We have identified a zebrafish strain, krm1(nl10), which carries a mutation in the kremen1 gene, a non-obligate co-receptor for the Dkk family of proteins. Previous studies have shown that Kremen1 inhibits Wnt signaling by facilitating internalization of the Kremen1-Dkk-Lrp5/6 complex. Surprisingly, we found that disruption of Kremen1 in the pLLP exhibited molecular and cellular phenotypes associated with a decrease rather than overactivation of Wnt signaling. Transplantation of wild-type cells into the mutant primordia failed to rescue the krm1(nl10) phenotype, thus revealing that the effects of Kremen1 loss are non-cell-autonomous. Finally, ectopic expression of Dkk1b-mTangerine protein revealed larger spread of the fusion protein in the mutant primordia compared with the wild type. Based on our data, we propose a novel mechanism in which Kremen1 modulates Wnt activity by restricting the range of secreted Dkk proteins during collective cell migration in the pLLP.