Although efavirenz (EFV) is efficacious as an antiretroviral therapy when combined with other antiretroviral drugs, it may cause adverse clinical effects, including skin and mucosal eruptions, central nervous system complications, hepatotoxicity, renal failure and pulmonary complications. The present study investigated the phenotypic alterations caused by EFV in normal human keratinocytes (NHKs) and determined the cell death pathways leading to the lack of epithelial proliferation and regeneration. Replication kinetics, cellular morphology, and protein and mRNA levels of cell cycle regulatory genes and cell death markers were compared between the EFV-exposed cells and the untreated control. EFV treatment led to cell proliferation arrest and cell death of the NHKs by inducing autophagy mediated by proteasome-dependent degradation of p53. EFV also reduced the levels of mTOR and active ERK signaling in NHKs. Chemical inhibition of p53 degradation with a proteasome inhibitor led to reduced autophagic response of NHKs to EFV. In addition, EFV triggered terminal differentiation of NHKs by inducing the expression of involucrin, filaggrin, loricrin and genes involved in cornified envelope formation. Inhibition of autophagy in the EFV-treated NHKs with 3-methylalanine reduced the levels of involucrin and the extent of cell death. Our data indicate that EFV elicits cytotoxic effects on NHKs in part through induction of autophagy and aberrant differentiation of cells.