Hu sheep (Ovis aries) is a rare white sheep breed, with four different types of lambskin patterns that have different values. However, the genetic mechanisms underlying different types of pattern formation remains unclear. This research aimed to characterize the molecular mechanism of differentially expressed gene PAPPA2 affecting the pattern type of Hu sheep’s lambskin at the cellular level. Thus, RT-qPCR, EdU and Cell Cycle detection were used to explore the effect of PAPPA2 and IGFBP5 (a protein that can be hydrolyzed by PAPPA2) on the proliferation of dermal papilla cells (DPCs) after overexpression or interference with PAPPA2 and IGFBP5. The expression level of PAPPA2 in straight DPCs was 4.79 ± 1.84 times higher than curved. Overexpression of PAPPA2 promoted the proliferation of DPCs and also increased the expression of IGFBP5. Conversely, overexpression of IGFBP5 reduced the proliferation of DPCs. However, the proliferation of DPCs was restored by co-overexpression of PAPPA2 and IGFBP5 compared with overexpression of IGFBP5 alone. Thus, PAPPA2 can affect the proliferation of DPCs through regulating IGFBP5 and then participate in lambskin pattern determination. Overall, we preliminarily clarified the critical role played by PAPPA2 during the formation of different pattern in Hu sheep lambskin.