The c-myc oncogene product (c-Myc) is a transcription factor that dimerizes with Max and recognizes the E-box sequence, and it plays key functions in cell proliferation, differentiation, and apoptosis. We previously showed that MM-1 bound to myc box II within the transactivation domain of c-Myc and repressed the E-box-dependent transcriptional activity of c-Myc. Here we report that MM-1 showed features of a tumor suppressor. In an EST data base search for cDNAs homologous to MM-1, we found a frequent substitution of amino acid 157 of MM-1, from alanine to arginine (A157R), and the substitution was observed more in tumor cells than in normal cells. A survey of the A157R mutation of MM-1 in 57 cultured cancer cells and 90 tissues from cancer patients showed that the A157R was present in about 50-60% of leukemia/lymphoma cells and in more than 75% of squamous cell carcinoma of tongue cancer. Although both the A157R and the wild-type MM-1 bound to c-Myc, only A157R lost the activities to repress both the E-box-dependent transcriptional activity of c-Myc and the myc/ras cooperative transforming activity in rat 3Y1 cells. Furthermore, the wild-type MM-1, but not A157R, arrested the growth of 3Y1 cells. The human MM-1 gene was mapped at chromosome 12q12-12q13, where many chromosome abnormalities in cancer cells have been reported. The results suggest that MM-1 is a novel candidate for a tumor suppressor that controls the transcriptional activity of c-Myc.