Control of cell cycle progression/exit and differentiation of neuronal precursors is of paramount importance during brain development. BM88 is a neuronal protein associated with terminal neuron-generating divisions in vivo and is implicated in mechanisms underlying neuronal differentiation. Here we have used mouse neuroblastoma Neuro 2a cells as an in vitro model of neuronal differentiation to dissect the functional properties of BM88 by implementing gain- and loss-of-function approaches. We demonstrate that stably transfected cells overexpressing BM88 acquire a neuronal phenotype in the absence of external stimuli, as judged by enhanced expression of neuronal markers and neurite outgrowth-inducing signaling molecules. In addition, cell cycle measurements involving cell growth assays, BrdUrd incorporation, and fluorescence-activated cell sorting analysis revealed that the BM88-transfected cells have a prolonged G(1) phase, most probably corresponding to cell cycle exit at the G(0) restriction point, as compared with controls. BM88 overexpression also results in increased levels of the cell cycle regulatory protein p53, and accumulation of the hypophosphorylated form of the retinoblastoma protein leading to cell cycle arrest, with concomitant decreased levels and, in many cells, cytoplasmic localization of cyclin D1. Conversely, BM88 gene silencing using RNA interference experiments resulted in acceleration of cell proliferation accompanied by impairment of retinoic acid-induced neuronal differentiation of Neuro 2a cells. Taken together, our results suggest that BM88 plays an essential role in regulating cell cycle exit and differentiation of Neuro 2a cells toward a neuronal phenotype and further support its involvement in the proliferation/differentiation transition of neural stem/progenitor cells during embryonic development.