Alternative splicing yields functionally distinctive gene products, and their balance plays critical roles in cell differentiation and development. We have previously shown that tumor-associated enhancer loss in coactivator gene CoAA leads to its altered alternative splicing. Here we identified two intergenic splicing variants, a zinc finger-containing coactivator CoAZ and a non-coding transcript ncCoAZ, between CoAA and its downstream corepressor gene RBM4. During stem/progenitor cell neural differentiation, we found that the switched alternative splicing and trans-splicing between CoAA and RBM4 transcripts result in lineage-specific expression of wild type CoAA, RBM4, and their variants. Stable expression of CoAA, RBM4, or their variants prevents the switch and disrupts the embryoid body formation. In addition, CoAA and RBM4 counter-regulate the target gene Tau at exon 10, and their splicing activities are subjected to the control by each splice variant. Further phylogenetic analysis showed that mammalian CoAA and RBM4 genes share common ancestry with the Drosophila melanogaster gene Lark, which is known to regulate early development and circadian rhythms. Thus, the trans-splicing between CoAA and RBM4 transcripts may represent a required regulation preserved during evolution. Our results demonstrate that a linked splicing control of transcriptional coactivator and corepressor is involved in stem/progenitor cell differentiation. The alternative splicing imbalance of CoAA and RBM4, because of loss of their common enhancer in cancer, may deregulate stem/progenitor cell differentiation.From the initial discovery of RNA splicing (1, 2) to recent advanced genomic studies (3), a large body of evidence suggests that alternative splicing as an integral part of gene regulation profoundly impacts biological and pathological functions (4). In the human genome, although ϳ20,000 protein-coding genes exist, more than 90% of multi-exon genes are alternatively spliced (3,5,6). Thus, alternative pre-mRNA splicing contributes greatly to proteome diversity without increasing the number of genes (7,8). Alternative splicing can be cell-and tissuespecific, which is particularly important at the early developmental stages (9). The wild type and variant proteins often exert overlapping but distinct functions whose balance is controlled by the choice of alternative splicing. Aberrant splicing patterns may disrupt the normal functional balance of isoforms, which in turn impairs cell differentiation and induces disease or cancer (10, 11).Pre-mRNA splicing is a process of joining exons and splicing out introns. In addition to constitutive splicing events, exons can be alternatively spliced. This includes exon skipping, alternative 5Ј and 3Ј splicing, mutually exclusive exons, intron retention, and alternative transcription start or stop sites (12). The cis-splicing mechanism involves splicing within one pre-mRNA molecule. In contrast, significant evidence supports that trans-splicing can occur at a much lower frequency by joining exons f...