To evaluate the localization and expression of peroxidase proliferator-activated receptor (PPAR)gamma in cholesteatoma epithelium. Experimental study. Reverse-transcription polymerase chain reaction was performed on cholesteatoma tissues from 10 adult patients undergoing tympanomastoid surgery for middle ear cholesteatoma and on 10 samples of normal external auditory canal skin tissue. The expression levels of PPARgamma to glyceraldehyde-3-phosphate dehydrogenase transcripts were semiquantified by densitometry. We also characterized the cellular localization of the PPARgamma protein immunohistochemically. Ki-67 was also localized to compare the proliferative activity of cells in cholesteatoma epithelium and in normal external auditory canal skin. PPARgamma mRNA and protein were detected in normal external auditory canal skin and in cholesteatoma epithelium. The expression level of PPARgamma mRNA in cholesteatoma was significantly increased compared with that in normal external auditory canal skin. PPARgamma protein was expressed in cells mainly in the granular and prickle cell layers. However, the intensity of its expression was generally decreased in the parabasal layer of the cholesteatoma epithelium. Ki-67 was expressed in the nuclei of cells in the basal and parabasal layers, and a greater number of cells were Ki-67 immunopositive in cholesteatoma epithelium. PPARgamma is up-regulated in the cholesteatoma epithelium compared with normal external auditory canal skin. These results suggest that PPARgamma may play an important role in the pathogenesis of cholesteatoma.