Keratinocyte growth factor is a potent and speci®c mitogen for dierent types of epithelial cells, including keratinocytes of the skin. Furthermore, it has been implicated in morphogenetic processes of several organs. To further de®ne the mechanisms of KGF action in the skin, we attempted to identify genes which are regulated by KGF in keratinocytes. Using the dierential display RT ± PCR technology, a gene was identi®ed which was strongly induced in these cells by treatment with KGF but not with serum growth factors or pro-in¯ammatory cytokines. Molecular cloning of the full-length cDNA revealed a strong homology of the corresponding gene product with a bovine non-selenium glutathione peroxidase. Upon transfection of COS cells with the fulllength cDNA, a 27 kD cytoplasmic protein was obtained which had the expected size of glutathione peroxidase. Expression of the novel gene was detected in normal human skin and at particularly high levels in psoriatic skin, indicating a possible in vivo function of the protein in this tissue. Identi®cation of a peroxidase as a KGFregulated gene suggests that prevention from oxygen toxicity is a novel and speci®c mechanism of KGF action.