The retinoic acid derivative fenretinide (FR) is capable of transdifferentiating cultured retinal pigment epithelial (RPE) cells towards a neuronal-like phenotype, but the underlying mechanisms are not understood. To identify genes involved in this process we performed a microarray analysis of RPE cells pre- and post-FR treatment, and observed a marked down-regulation of AnnexinA8 (AnxA8) in transdifferentiated cells. To determine whether AnxA8 plays a role in maintaining RPE cell phenotype we directly manipulated AnxA8 expression in cultured and primary RPE cells using siRNA-mediated gene suppression, and over-expression of AnxA8-GFP in conjunction with exposure to FR. Treatment of RPE cells with AnxA8 siRNA recapitulated exposure to FR, with cell cycle arrest, neuronal transdifferentiation, and concomitant up-regulation of the neuronal markers calretinin and calbindin, as assessed by real-time PCR and immunofluorescence. In contrast, AnxA8 transient over-expression in ARPE-19 cells prevented FR-induced differentiation. Ectopic expression of AnxA8 in AnxA8-depleted cells led to decreased neuronal marker staining, and normal cell growth as judged by phosphohistone H3 staining, cell counting and cleaved caspase-3 levels. These data show that down-regulation of AnxA8 is both necessary and sufficient for neuronal transdifferentiation of RPE cells and reveal an essential role for AnxA8 as a key regulator of RPE phenotype.