In certain forms of collective cell migration, changes in neighboring cells (neighbor exchange, NE) are essential. In the axial mesoderm in zebrafish, for example, the notochord is established through cell movements known as convergence and extension (C&E), which involves NE. For NE to occur efficiently, the balance between cell-scale and supracellular stresses plays a crucial role, but the molecular basis of how these stresses are controlled remains unclear. In this study, we focused on Pcdh8/Paraxial protocadherin (PAPC), which is specifically suppressed in the region (notochord) where and at the time (early gastrula) when extensive C&E occurs. Forced expression of PAPCΔC (PAPC lacking its intracellular domain) persisted in the developing notochord and resulted in morphogenetic defects in zebrafish. PAPCΔC was found to downregulate NE in the notochord in a homophilic contact-dependent manner. By examining oil droplets inserted between cells, we revealed that while cell-scale stresses were apparently unaffected, the direction of bias in the supracellular stresses was stabilized by the introduction of PAPCΔC in the notochordal region. Taken together, our results suggest that suppression of PAPC in the notochord is required to modify supracellular stresses and provide the conditions in which NE occurs efficiently, thus promoting morphogenetic cell movements.