The basic helix-loop-helix transcription factor OLIG2 is specifically expressed in cells of the oligodendrocyte lineage. It is also expressed in various tumors originating from glial cells; however, the expression of OLIG2 is rare or weak in glioblastomas, the most malignant gliomas. The role of OLIG2 in glioma remains unclear. To investigate the function of OLIG2 in glial tumor cells, we have established a glioblastoma cell line, U12-1, in which the expression of OLIG2 is induced by the Tet-off system. Induction of OLIG2 resulted in suppression of both the proliferation and anchorage-independent growth of U12-1. It also resulted in an increase in the expression of p27(Kip1). A luciferase assay revealed that the CTF site of the p27(Kip1) gene promoter was essential for OLIG2-dependent activation of p27(Kip1) gene transcription. Electrophoretic mobility shift assays confirmed that a nuclear extract of OLIG2-expressing U12-1 cells contained a protein complex that binds to the CTF site of the p27(Kip1) gene promoter. Furthermore, siRNA against p27(Kip1) rescued the OLIG2-mediated growth and DNA synthesis inhibition of U12-1 cells. These results indicate that OLIG2 suppresses the proliferation of U12-1 and that this effect is mediated by transactivation of the p27(Kip1) gene, and low expression of OLIG2 may be related to the malignant behavior of human glioblastoma.