In recent years a growth inhibitory role in skin for the Rel/NF-kappaB transcription factors has been established, and the block of Rel/NF-kappaB signaling results in rapid development of spontaneous skin cancer. The molecular mechanism underlying tumor development is however unknown. In the present study, we show that inhibition of NF-kappaB signaling in mouse skin by targeted expression of degradation resistant IkappaB-alpha generates transgenic keratinocytes unable to arrest the cell cycle in response to DNA damage induced by gamma-radiation. The results indicate that transgenic keratinocytes have a defect at the G1-S checkpoint whereas the G2-M checkpoint response was found to be intact. However, transgenic keratinocytes still respond by induction of the cyclin dependent kinase inhibitor p21(Cip1/Waf) after exposure to gamma-radiation. In the spontaneous skin tumors that develop in transgenic mice no mutations were found in the Ha-ras or p53 gene, suggesting that inhibition of NF-kappaB signaling in skin can induce cancer development independently of initiating mutations in the Ha-ras gene or additional mutations in the p53 gene. These findings demonstrate an involvement of NF-kappaB signaling in the DNA damage response and cell cycle checkpoint control in the skin.