Previously we documented that human epidermis exclusively expresses corticotropin releasing hormone receptor 1 (CRH-R1). To define the role of CRH in the epidermis, we investigated its effects on differentiation of normal human adult epidermal keratinocytes. Thus, CRH inhibited proliferation in a dose dependent fashion and significantly decreased Ki-67 antigen expression. This effect was independent of either the presence or the absence of growth factors in the medium. Flow cytometry analysis demonstrated that CRH inhibited the transition from G0/1 to S phase of the cell cycle, which was accompanied by an increased expression of cdk inhibitor p16 (Ink4a) protein. The antiproliferative effect was attenuated by protein kinase C inhibitor (GF109203X) but not by H89 (protein kinase A inhibitor), PD98059, or SB203580 (MAP kinase inhibitors). The cell cycle withdrawal was associated with the induction of keratinocyte differentiation. Thus, CRH stimulated the expression of cytokeratin 1 and involucrin, and inhibited cytokeratin 14 on both mRNA and protein levels. It also increased cell granularity and cell size. Furthermore, CRH induced signal transduction cascade that included stimulation of inositol 1,4,5-triphosphate, which was time and dose dependent. CRH also increased activator protein-1 DNA binding activity with JunD identified as the most important element. Thus, activation of CRH-R1 induces a non-random and sequential signal transduction cascade governing both keratinocyte differentiation and the inhibition of cell proliferation through G0/1 arrest. We propose that this program, triggered by CRH interaction with CRH-R1, includes induction of a transduction pathway involving the sequential activation of phospholipase C, protein kinase C, activator protein-1 (including Jun D), and p16.