In the skin, expression of several matrix metalloproteinases (MMPs) occurs in response to tissue injury, tumorigenesis, angiogenesis, apoptosis, and inflammation. The recently cloned MMP-21 has been implicated in skin development and various epithelial cancers. In this study, we found that it is also expressed by differentiated keratinocytes (KCs) in various benign skin disorders, in which it was not associated with KC apoptosis or proliferation, and in organotypic cultures. Furthermore, MMP-21 was induced in keratinocytes in association with increased calcium and presence of the differentiation marker filaggrin. In stably transfected A431 and HEK293 cell lines, MMP-21 increased invasion of cells but did not associate with increased apoptosis, proliferation, or epithelial-to-mesenchymal transition. Of various agents tested in HaCaT cell cultures, only retinoic acid (10(-6) M) and staurosporine (2.5 x 10(-8) M) upregulated MMP-21 mRNA and protein expression, whereas tumor promoters, hormones, or dexamethasone were without effect. Our results suggest that MMP-21 may be an important protease in the terminal differentiation of keratinocytes.