Maspin is a key tumor suppressor gene in prostate and breast cancers with diverse biological functions. However, how maspin regulates prostate tumor progression is not fully understood. In this study, we have used maspin heterozygous knockout mice to determine the effect of maspin haploinsufficiency on prostate development and tumor progression. We report that loss of one copy of maspin gene in Mp(+/-) heterozygous knockout mice leads to the development of prostate hyperplastic lesions, and this effect was mediated through decreased level of cyclin-dependent kinase inhibitors p21 and p27. Prostate hyperplastic lesions in Mp(+/-) mice also induced stromal reaction, which occurred in both aged prostate tissues and in neonatal prostates during early ductal morphogenesis. We showed that maspin was also expressed in prostate smooth muscle cells (PSMC), and recombinant maspin increased PSMC cell adhesion but inhibited cell proliferation. We also observed a defective interaction between epithelial cells and basement membrane in the prostate of Mp(+/-) mice, which was accompanied with a changed pattern of matrix deposition and a loss of epithelial cell polarity. Therefore, we have identified a novel property of maspin, which involves the control of the proliferation in prostate epithelial and smooth muscle cells. This is the first report that a partial loss of maspin caused an early developmental defect of the prostate and prostate hyperplastic lesions in mouse.