In skin, multipotent stem cells generate the keratinocytes of the epidermis, sebaceous gland, and hair follicles. In this paper, we show that Tcf3 and Lef1 control these differentiation lineages. In contrast to Lef1, which requires Wnt signaling and stabilized ␤-catenin to express the hair-specific keratin genes and control hair differentiation, Tcf3 can act independently of its ␤-catenin interacting domain to suppress features of epidermal terminal differentiation, in which Tcf3 is normally shut off, and promote features of the follicle outer root sheath (ORS) and multipotent stem cells (bulge), the compartments which naturally express Tcf3. These aspects of Tcf3's action are dependent on its DNA binding and Groucho repressor-binding domains. In the absence of its ␤-catenin interacting domain, Lef1's behavior (⌬NLef1) seems to be markedly distinct from that of ⌬NTcf3. ⌬NLef1 does not suppress epidermal differentiation and promote ORS/bulge differentiation, but rather suppresses hair differentiation and gives rise to sebocyte differentiation. Taken together, these findings provide powerful evidence that the status of Tcf3/Lef complexes has a key role in controlling cell fate lineages in multipotent skin stem cells. The canonical Wnt/Wingless signaling pathway directs cell fate in a variety of cell types and has an integral role in organogenesis. At the core of the pathway is the stability of ␤-catenin, a protein that serves a dual role in intercellular junction formation and in transcriptional regulation. Wnt signaling inhibits the amino-terminal phosphorylation and subsequent degradation of ␤-catenin, allowing cytoplasmic pools of ␤-catenin to enter the nucleus and bind to members of the Lef1/Tcf family of HMG domain-containing DNA-binding proteins. ␤-catenin's activation domain and Lef1/Tcf's DNA-binding domain combine to form a bipartite transcriptional activator of target genes (for review, see Willert and Nusse 1998;Korswagen and Clevers 1999;Waltzer and Bienz 1999).Although Lef1/Tcf proteins often function as transactivators, these proteins can also interact with, and behave as, transcriptional repressors. CtBP represses a Wnt/Wingless response and selectively interacts with the carboxy-terminal domain of Tcf proteins, missing in Lef1 (Brannon et al. 1999). In contrast, the Groucho family of repressor proteins associate with the amino-terminal domain of all known Tcf/Lef family members (Cavallo et al. 1998;Roose et al. 1998;Brantjes et al. 2001). Genetically, a Drosophila dTcf-Groucho interaction antagonizes Wnt/Wingless signaling (Cavallo et al. 1998), and expression of Groucho proteins in Xenopus embryos can block axis formation and activation of ␤-catenin target genes, such as siamois and xnr3 ). In zebrafish, embryonic Tcf3 appears to function as a transcriptional repressor, as an amino-terminally truncated Tcf3 (missing its ␤-catenin binding domain) complements the headless phenotype caused by loss-of-function of wild-type Tcf3 (Kim et al. 2000). Therefore, in the absence of a Wnt/Wingless signal, the...

The observation that Tcf3 (MGI name: Tcf7l1) bound the same genes as core stem cell transcription factors, Oct4 (MGI name:Pou5f1), Sox2 and Nanog, revealed a potentially important aspect of the poorly understood mechanism whereby Wnts stimulate self renewal of pluripotent mouse embryonic stem (ES) cells. Although the conventional view of Tcf proteins as the β-catenin-binding effectors of Wnt signaling suggested Tcf3-β-catenin mediated activation of target genes would stimulate ES cell self renewal, here we show that an antagonistic relationship between Wnt3a and Tcf3 on gene expression is important for regulating ES cell self renewal. Genetic ablation of Tcf3 replaced the requirement for exogenous Wnt3a or GSK3-inhibition for self renewal of ES cells, demonstrating that inhibition of Tcf3-repressor is the necessary downstream effect of Wnt signaling. Interestingly, the molecular mechanism underlying Wnt’s effects required both Tcf3-β-catenin and Tcf1-β-catenin interactions, as they each contributed to Wnt stimulation of self renewal and gene expression. Finally, the combination of Tcf3 and Tcf1 was necessary to recruit Wnt-stabilized β-catenin to Oct4 binding sites in ES cell chromatin. These results elucidate the molecular link between the effects of Wnt and the regulation of the Oct4/Sox2/Nanog network.

The dual function of stem cells requires them not only to form new stem cells through self-renewal but also to form lineage-committed cells through differentiation. Embryonic stem cells (ESC), which are derived from the blastocyst inner cell mass, retain properties of self-renewal and the potential for lineage commitment. To balance self-renewal and differentiation, ESC must carefully control the levels of several transcription factors, including Nanog, Sox2, and Oct4. While molecular mechanisms promoting transcription of these genes have been described, mechanisms preventing excessive levels in self-renewing ESC remain unknown. By examining the function of the TCF family of transcription factors in ESC, we have found that Tcf3 is necessary to limit the steady-state levels of Nanog mRNA, protein, and promoter activity in self-renewing ESC. Chromatin immunoprecipitation and promoter reporter assays showed that Tcf3 bound to a promoter regulatory region of the Nanog gene and repressed its transcriptional activity in ESC through a Groucho interaction domaindependent process. The absence of Tcf3 caused delayed differentiation of ESC in vitro as elevated Nanog levels persisted through 5 days of embryoid body formation. These new data support a model wherein Tcf3-mediated control of Nanog levels allows stem cells to balance the creation of lineage-committed and undifferentiated cells.

The roles of Lef/Tcf proteins in determining cell fate characteristics have been described in many contexts during vertebrate embryogenesis, organ and tissue homeostasis, and cancer formation. Although much of the accumulated work on these proteins involves their ability to transactivate target genes when stimulated by β-catenin, Lef/Tcf proteins can repress target genes in the absence of stabilized β-catenin. By ablating Tcf3 function, we have uncovered an important requirement for a repressor function of Lef/Tcf proteins during early mouse development. Tcf3-/- embryos proceed through gastrulation to form mesoderm, but they develop expanded and often duplicated axial mesoderm structures, including nodes and notochords. These duplications are preceded by ectopic expression of Foxa2, an axial mesoderm gene involved in node specification, with a concomitant reduction in Lefty2, a marker for lateral mesoderm. By contrast,expression of a β-catenin-dependent, Lef/Tcf reporter (TOPGal), is not ectopically activated but is faithfully maintained in the primitive streak. Taken together, these data reveal a unique requirement for Tcf3 repressor function in restricting induction of the anterior-posterior axis.