The homeobox gene Hoxa-1 is transcriptionally regulated by retinoic acid (RA) and encodes a transcription factor which has been shown to play important roles in cell differentiation and embryogenesis. In order to clone and characterize target genes of Hoxa-1, we utilized differential hybridization screening and cDNA subtractive hybridization methods to identify genes which are differentially expressed in F9-10, a murine F9 teratocarcinoma stem cell line which expresses high levels of exogenous Hoxa-1, compared to F9 wild-type stem cells, which do not express endogenous Hoxa-1 mRNA in the absence of RA. Twenty-eight candidate genes were identified; these genes encode very diverse proteins, including signaling molecules such as BMP-4, the enzyme superoxide dismutase, the cell adhesion molecule cadherin-6, proteins involved in gene transcription such as HMG-1 and SAP18, homeodomain-containing proteins Gbx-2 and Evx-2, and cell cycle regulatory proteins such as the retinoblastoma binding protein-2. Clone 104 encodes a novel protein; the expression of the clone 104 mRNA is also regulated in a fashion very similar to that of the exogenous Hoxa-1 gene in another F9 cell line, called F9-tet-Hoxa1-8, in which the exogenous Hoxa-1 mRNA expression is tightly regulated by a Tet-off gene expression system. These data strongly suggest that clone 104 is a direct downstream target of the transcription factor Hoxa-1. The cDNA sequence of clone 104 is related to that of human ubiquitin carboxyl-terminal hydrolase T. Further characterization of these putative Hoxa-1 target genes will aid in delineating the functions of the Hoxa-1 protein in the differentiation processes which occur during embryogenesis.