To identify potential effectors of transforming growth factor (TGF)-beta-mediated suppression of colon cancer, we used GeneChip expression microarrays to identify TGF-beta-induced genes in VACO 330, a nontransformed TGF-beta-sensitive cell line derived from a human adenomatous colon polyp. PMEPA1 was identified as a gene highly up-regulated by TGF-beta treatment of VACO 330. Northern blot analysis confirmed TGF-beta induction of PMEPA1 in VACO 330, as well as a panel of three other TGF-beta-sensitive colon cell lines. PMEPA1 induction could be detected as early as 2 h after TGF-beta treatment and was not inhibited by pretreatment of cells with cycloheximide, suggesting that PMEPA1 is a direct target of TGF-beta signaling. Wild-type PMEPA1 and an alternative splice variant lacking the putative transmembrane domain were encoded by the PMEPA1 locus and were shown by epitope tagging to encode proteins with differing subcellular localization. Both variants were found to be expressed in normal colonic epithelium, and both were shown to be induced by TGF-beta. Consistent with TGF-beta playing a role in terminal differentiation of colonocytes, in situ hybridization of normal colonic epithelium localized PMEPA1 expression to nonproliferating, terminally differentiated epithelium located at the top of colonic crypts. Intriguingly, in situ hybridization and Northern blot analysis showed that the expression of PMEPA1 was well maintained both in colon cancer primary tumors and in colon cancer liver metastases. PMEPA1 is thus a novel TGF-beta-induced marker of a differentiated crypt cell population. Moreover, as PMEPA1 expression is maintained, presumptively in a TGF-beta-independent manner after malignant transformation and metastasis, it demonstrates that even late colon cancers retain a strong capacity to execute many steps of the normal colonic differentiation program.