Activin A, a member of the transforming growth factor beta (TGF-beta) superfamily, affects keratinocyte proliferation and differentiation in vitro and in vivo. However, little is known about the mechanisms of activin action in keratinocytes, and its target genes have not been identified. In this study, we demonstrate that activin A and TGF-beta1 directly induce the expression and activity of Mad1, an antagonist of the c-Myc transcription factor, in the human HaCaT keratinocyte cell line. Expression and activity of Mad1 was strongly induced by both factors in keratinocytes, although the intensity of induction was different for activin A and TGF-beta1. To determine a possible role of activin and TGF-beta in the regulation of mad1 expression in vivo, we analysed its expression during cutaneous wound repair when high levels of these factors are present. Expression of mad1 mRNA and protein, but not of other mad genes, increased significantly after skin injury, particularly in polymorphonuclear leukocytes and in suprabasal keratinocytes of the hyperproliferative epithelium. Elevated levels of mad1 mRNA were also detected in the hyperthickened epidermis of psoriatic patients. Since Mad1 regulates proliferation and/or differentiation of various cell types, our results suggest that this transcription factor mediates at least in the part the anti-mitotic and/or differentiation-inducing activities of TGF-beta and activin in keratinocytes.