A novel DNA sequence has been isolated from a subtraction cDNA library of P19 embryonal carcinoma cells treated with retinoic acid which induces neural differentiation of the stem cells. The cDNA insert (4B) hybridized with a single 1.7 kb mRNA, whose abundance was markedly increased in P19 cells after retinoic acid treatment. The 1.7 kb mRNA was also expressed in the brain, but not in other non-neuronal tissues. A 1.6 kb cDNA insert (4BFL), which was cloned by screening another cDNA library with the 4B probe, encodes a novel protein sequence of 325 amino acids (Mr 36,831). The protein expressed in 4BFL-transfected COS cells was translocated into the nuclei as detected with antibodies against subsequences of the predicted protein. The antibodies stained the nuclei of neurally differentiated P19 cells but not of the undifferentiated stem cells. This novel mRNA encoding the nuclear protein, termed necdin, may represent a useful marker for the differentiation and development of brain cells.