The IKKalpha and IKKbeta catalytic subunits of IkappaB kinase (IKK) share 51% amino-acid identity and similar biochemical activities: they both phosphorylate IkappaB proteins at serines that trigger their degradation. IKKalpha and IKKbeta differ, however, in their physiological functions. IKKbeta and the IKKgamma/NEMO regulatory subunit are required for activating NF-kappaB by pro-inflammatory stimuli and preventing apoptosis induced by tumour necrosis factor-alpha (refs 5,6,7,8,9,10,11). IKKalpha is dispensable for these functions, but is essential for developing the epidermis and its derivatives. The mammalian epidermis is composed of the basal, spinous, granular and cornified layers. Only basal keratinocytes can proliferate and give rise to differentiated derivatives, which on full maturation undergo enucleation to generate the cornified layer. Curiously, keratinocyte-specific inhibition of NF-kappaB, as in Ikkalpha-/- mice, results in epidermal thickening but does not block terminal differentiation. It has been proposed that the epidermal defect in Ikkalpha-/- mice may be due to the failed activation of NF-kappaB. Here we show that the unique function of IKKalpha in control of keratinocyte differentiation is not exerted through its IkappaB kinase activity or through NF-kappaB. Instead, IKKalpha controls production of a soluble factor that induces keratinocyte differentiation.