Cellular retinoic acid-binding protein (CRABPs) are a family of proteins that specifically bind retinoic acid (RA) and have been implicated in mediating its action, although their exact function is still unknown. Two CRABPs have been identified and cloned. CRABP I is present in many tissues and cultured cells; CRABP II, first detected in embryonic and neonatal skin of rats and chicks, is now recognized as the predominant form in human epidermis. Using a human living skin equivalent model composed of a deremis and an epidermis and human cDNAs recently cloned in our laboratory, we have studied the effects of 10-6 M RA and etretin (ET) on the expression of CRABPs under different culture conditions intended to favor greater or lesser degrees of epidermal differentiation. Total cellular RNA was isolated separately from the dermis and epidermis and processed for northern blot analysis. At a presumptive physiologic RA concentration, only the gene for CRABP II, and not for CRABP I, was expressed. CRABP II transcripts were far more abundant on a per cell basis in epidermal keratinocytes than in dermal fibroblasts under all conditions studied. Epidermal differentiation, stimulated by air exposure of the cultures, tended to enhance CRABP II expression, and treatment with presumptive therapeutic concentrations of the two retinoid compounds tended to decrease CRABP II expression. Opposite effects of air exposure and retinoid treatment were observed on steady state levels of mRNA for selected markers of epidermal differentiation: involucrin, transglutaminase, and spr I. These results are consistent with earlier work at the protein level examining the effect of retinoids on CRABP activity and state of differentiation both in vivo and in vitro. Thus, the skin equivalent appears to be an excellent model system for investigating the role of CRABPs in mediating retinoid effects at the cellular and molecular levels.