The Wilms' tumour suppressor protein WT1 plays a central role in the development of the kidney and also other organs. WT1 can act as a transcription factor with highly context-specific activator and repressor functions. We previously identified Brain Acid Soluble Protein 1 (BASP1) as a transcriptional cosuppressor that can block the transcriptional activation function of WT1. WT1 and BASP1 are co-expressed during nephrogenesis and both proteins ultimately become restricted to the podocyte cells of the adult kidney. Here, we have analysed the WT1/BASP1 complex in a podocyte precursor cell line that can be induced to differentiate. Chromatin immunoprecipitation revealed that WT1 and BASP1 occupy the promoters of the Bak, c-myc and podocalyxin genes in podocyte precursor cells. During differentiation-dependent upregulation of podocalyxin expression BASP1 occupancy of the podocalyxin promoter is reduced compared to that of WT1. In contrast, the repressive WT1/BASP1 occupancy of the c-myc and Bak promoters is maintained and these genes are downregulated during the differentiation process. We provide evidence that the regulation of BASP1 promoter occupancy involves the sumoylation of BASP1. Our results reveal a dynamic cooperation between WT1 and BASP1 in the regulation of gene expression during differentiation.