The interaction of a cytokine with its specific cell surface receptor triggers the activation of intracellular signaling pathways that ultimately program the cellular response. The signal transducers and activators of transcription (STAT) proteins play important roles in the activation of these pathways. Recently, a family of proteins has been identified that inhibits activated STATS and are named as Protein Inhibitors of Activated STAT (PIAS). PIAS proteins comprise a family of five mammalian proteins, which have been identified as potentially important down regulators of the STAT-signaling pathway. The cDNA for mouse and human PIASg encodes a protein of 507 amino acids that is highly homologous to the human protein and is expressed in the mouse as early as d 7.5 of gestation. In situ hybridizations of staged mouse embryos localized the transcript for the PIASgamma gene to the limbs, neuroepithelium, and the inner root sheath of the hair follicle, suggesting a role in the development of these structures. This protein is also present in hair follicle of human scalp hair and in monkey neuronal cells. Thus PIASg exhibits a highly selective pattern of expression, suggesting that it modulates the response of cells to developmental cues.