In this study we used a dominant-negative FGF receptor mutant to block FGF function in a specific tissue of transgenic mice. The mutant receptor, which is known to block signal transduction in cells when co-expressed with wild-type receptors, was targeted to suprabasal keratinocytes using a keratin 10 promoter. The transgene was expressed specifically in the skin and highest expression levels were found in the tail. Expression of the mutant receptor disrupted the organization of epidermal keratinocytes, induced epidermal hyperthickening and resulted in an aberrant expression of keratin 6. This suggests that FGF is essential for the morphogenesis of suprabasal keratinocytes and for the establishment of the normal program of keratinocyte differentiation. Our study demonstrates that dominant-negative growth factor receptors can be used to block selectively the action of a growth factor in specific tissues of transgenic mice.