Defects in growth control and differentiation occur frequently in human cancers. In the case of human melanoma cells, treatment with a combination of fibroblast interferon (IFN-beta) and the protein kinase C activator mezerein (MEZ) results in an irreversible loss of proliferative potential and tumorigenic properties with a concomitant induction of terminal differentiation. These changes in cellular properties are associated with an induction and suppression in specific subsets of genes that occur in a temporal manner. To identify the complete repertoire of gene changes occurring during melanoma reversion to a more differentiated state a number of molecular approaches are being used. These include, subtraction hybridization using temporally spaced cDNA libraries, random cDNA isolation and evaluation by reverse Northern blotting and high throughput microarray analysis of subtracted cDNA clones. In the present study we have used a novel approach, rapid subtraction hybridization (RaSH), to identify and clone an additional gene of potential relevance to cancer growth control and terminal cell differentiation. RaSH has identified a human ubiquitin-processing protease gene, HuUBP43, that is differentially expressed in melanoma cells as a function of treatment with IFN-beta or IFN-beta + MEZ. HuUBP43 is a type I interferon inducible gene that is upregulated in a diverse panel of normal and tumor cells when treated with IFN-beta via the JAK/STAT kinase pathway. This gene may contribute to the phenotypic changes induced by IFN-beta during growth arrest and differentiation in human melanoma cells and other cell types as well as the antiviral and growth inhibitory effects of interferon.