The transcription factor Twist1 has been reported to be essential for the formation and invasiveness of chemically induced tumors in mouse skin. However, the impact of keratinocyte-specific Twist1 deletion on skin carcinogenesis caused by UVB radiation has not been reported. Deletion of Twist1 in basal keratinocytes of mouse epidermis using K5.Cre × Twist1flox/flox mice led to significantly reduced UVB-induced epidermal hyperproliferation. In addition, keratinocyte-specific deletion of Twist1 significantly suppressed UVB-induced skin carcinogenesis. Further analyses revealed that deletion of Twist1 in cultured keratinocytes or mouse epidermis in vivo led to keratinocyte differentiation. In this regard, deletion of Twist1 in epidermal keratinocytes showed significant induction of early and late differentiation markers, including TG1, K1, OVOL1, loricrin, and filaggrin. Similar results were obtained with topical application of harmine, a Harmala alkaloid that leads to degradation of Twist1. In contrast, overexpression of Twist1 in cultured keratinocytes suppressed calcium-induced differentiation. Further analyses using both K5.Cre × Twist1flox/flox mice and an inducible system where Twist1 was deleted in bulge region keratinocytes showed loss of expression of hair follicle stem/progenitor markers, including CD34, Lrig1, Lgr5, and Lgr6. These data support the conclusion that Twist1 has a direct role in maintaining the balance between proliferation and differentiation of keratinocytes and keratinocyte stem/progenitor populations. Collectively, these results demonstrate a critical role for Twist1 early in the process of UVB skin carcinogenesis, and that Twist1 may be a novel target for the prevention of cutaneous squamous cell carcinoma.