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Motile cilia perform crucial functions during embryonic development and throughout adult life. Development of organs containing motile cilia involves regulation of cilia formation (ciliogenesis) and formation of a luminal space (lumenogenesis) in which cilia generate fluid flows. Control of ciliogenesis and lumenogenesis is not yet fully understood, and it remains unclear whether these processes are coupled. In the zebrafish embryo, lethal giant larvae 2 (lgl2) is expressed prominently in ciliated organs. Lgl proteins are involved in establishing cell polarity and have been implicated in vesicle trafficking. Here, we identified a role for Lgl2 in development of ciliated epithelia in Kupffer's vesicle, which directs left-right asymmetry of the embryo; the otic vesicles, which give rise to the inner ear; and the pronephric ducts of the kidney. Using Kupffer's vesicle as a model ciliated organ, we found that depletion of Lgl2 disrupted lumen formation and reduced cilia number and length. Immunofluorescence and time-lapse imaging of Kupffer's vesicle morphogenesis in Lgl2-deficient embryos suggested cell adhesion defects and revealed loss of the adherens junction component E-cadherin at lateral membranes. Genetic interaction experiments indicate that Lgl2 interacts with Rab11a to regulate E-cadherin and mediate lumen formation that is uncoupled from cilia formation. These results uncover new roles and interactions for Lgl2 that are crucial for both lumenogenesis and ciliogenesis and indicate that these processes are genetically separable in zebrafish.