KLF4 is induced upon growth-arrest in vitro and during epithelial maturation in vivo, and is essential for proper cell fate specification of post-mitotic cells. In spite of a normal role in post-mitotic cells, expression is upregulated and constitutive in certain tumor types. KLF4 functions as an oncogene in vitro, and enforced expression in basal cells of mouse skin rapidly induces lesions similar to hyperplasia, dysplasia and squamous cell carcinoma (SCC). Here we used conditional expression to characterize early steps in KLF4-mediated tumor initiation. In contrast to SCC-like lesions that result when using a conditional, keratin 14 promoter-dependent strategy, lower conditional expression achieved using a MMTV promoter induced only epidermal cycling within morphologically normal skin, a process we termed occult cell turnover. Surprisingly, KLF4-induced hyperplastic lesions showed increased transgene-derived mRNA and protein in maturing, PCNA-negative cells, a property of endogenous KLF4. In contrast, hyperplastic lesions induced by GLI1, a control, showed uniform transgene expression. In KLF4-induced dysplasia and SCC the complementarity of KLF4 and PCNA was replaced by concordance of the two proteins. These studies show that KLF4 transcripts are normally suppressed in cycling cells in a promoter-independent fashion, consistent with a post-transcriptional control, and reveal loss of this control in the transition from hyperplasia to dysplasia. Like the mouse tumors, human cutaneous SCCs and adjacent dysplasias frequently showed maturation-independence of KLF4, with co-expression of KLF4 and PCNA. A smaller subset of human SCCs showed complementarity of KLF4 and PCNA, similar to hyperplastic mouse skin. The results identify parallels between a mouse model and human primary tumors, and show that successive increases of KLF4 in the nuclei of basal keratinocytes leads to occult cell turnover followed by hyperplasia, dysplasia, and invasive SCC. ©2005 Landes Bioscience.