Many agents that exhibit chemopreventive activity are able to mediate a differentiation response in premalignant and malignant tissues. One of the most widely studied classes of tumor differentiation agents is the retinoids. There is rapidly evolving evidence for beneficial retinoid actions in the prevention or treatment of clinical tumors. However, the use of retinoids in the clinic is limited by acquired resistance and toxicity, especially when administered chronically in preventive strategies. Although retinoids are known to regulate gene transcription by activating retinoid receptors, the identity of the target genes that mediate the beneficial effects of retinoids are largely unknown. Here we review a useful model of retinoid-induced tumor cell differentiation: human embryonal carcinoma. The pluripotent nature and ease of use make human embryonal carcinoma cells a valuable and practical complement to human embryonic stem cells as an in vitro model of early human development. In addition, retinoid treatment of human embryonal carcinoma is an important model of induced tumor cell differentiation because retinoids cause the reversal of the malignant phenotype coincident with terminal neuronal differentiation. We have used both de novo and candidate approaches with this system in an effort to uncover critical downstream targets of retinoid receptors during differentiation induction.