Differentiation of skin stem cells into hair follicles (HFs) requires the inhibition of beta-catenin degradation, which is controlled by a complex containing axin and the protein kinase GSK3beta. Using conditional gene targeting in mice, we show now that the small GTPase Cdc42 is crucial for differentiation of skin progenitor cells into HF lineage and that it regulates the turnover of beta-catenin. In the absence of Cdc42, degradation of beta-catenin was increased corresponding to a decreased phosphorylation of GSK3beta at Ser 9 and an increased phosphorylation of axin, which is known to be required for binding of beta-catenin to the degradation machinery. Cdc42-mediated regulation of beta-catenin turnover was completely dependent on PKCzeta, which associated with Cdc42, Par6, and Par3. These data suggest that Cdc42 regulation of beta-catenin turnover is important for terminal differentiation of HF progenitor cells in vivo.
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