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Objective To investigate the expression of PAX genes, a family of developmental control genes (which encode nine nuclear transcription factors essential for embryogenesis and are proto‐oncogenes in mice) in human transitional cell carcinoma (TCC) of the bladder. Materials and methods PAX gene expression was assessed in three established bladder cancer cell lines and 29 primary tumours using the reverse transcriptase‐polymerase chain reaction and Southern analysis. Results All three established TCC cell lines and 79% of primary TCCs expressed PAX5 mRNA. There was a significantly higher proportion of PAX5 expression in malignant than in benign urothelium (P=0.02, Fisher’s exact test); nine of 12 pTa tumours (mucosa‐confined), seven of eight pT1 (invading lamina propria) and eight of nine pT2 (invading muscle) expressed PAX5. A higher proportion of tumours with increasing de‐differentiation expressed PAX5, which correlates well with the expression pattern of PAX5 in development. In well‐differentiated tumours (grade 1), half expressed PAX5, compared with 84% of moderately to poorly differentiated tumours (grades 2/3). The odds ratio for PAX5 expression in malignancy suggests that it increases the risk of malignancy four‐fold. Conclusion These data support a role for the PAX family in oncogenesis, by identifying another human neoplasm in which they are inappropriately expressed. PAX5 expression in undifferentiated TCC cells may contribute to pathogenesis by supporting cellular proliferation in the de‐differentiated state. Furthermore, the high incidence of PAX5 expression suggests its potential use as a diagnostic tool and therapeutic target in TCC.