The involvement of p53 protein in cell differentiation has been recently suggested by some observations made with tumor cells and the correlation found between differentiation and increased levels of p53. However, the effect of p53 on differentiation is in apparent contrast with the normal development of p53-null mice. To test directly whether p53 has a function in cell differentiation, we interfered with the endogenous wt-p53 protein of nontransformed cells of two different murine histotypes: 32D myeloid progenitors, and C2C12 myoblasts. A drastic inhibition of terminal differentiation into granulocytes or myotubes, respectively, was observed upon expression of dominant-negative p53 proteins. This inhibition did not alter the cell cycle withdrawal typical of terminal differentiation, nor p21(WAF1/CIP1) upregulation, indicating that interference with endogenous p53 directly affects cell differentiation, independently of the p53 activity on the cell cycle. We also found that the endogenous wt-p53 protein of C2C12 cells becomes transcriptionally active during myogenesis, and this activity is inhibited by p53 dominant-negative expression. Moreover, we found that p53 DNA-binding and transcriptional activities are both required to induce differentiation in p53-negative K562 cells. Taken together, these data strongly indicate that p53 is a regulator of cell differentiation and it exerts this role, at least in part, through its transcriptional activity.