Mouse milk fat globule-EGF factor 8, MFG-E8, is the ortholog to the human mammary tumor marker, lactadherin, and comprises two spliced variants, the L and S forms. Recent studies have suggested that MFG-E8-L produced by macrophages and Langerhans cells in the skin serves as a linker between phagocytic cells and apoptotic cells, and that MFG-E8-S, also termed SED1, facilitates sperm-egg interaction for fertilization. However, Mfge8 gene expression occurs in various tissues apparently unrelated to these critical events. Our in situ hybridization study has revealed that Mfge8 is expressed in the periderm (the premature epidermis) on embryonic day-14, well before Langerhans cells begin to grow in the prenatal phase. Mfge8 transcript is detectable in the basal and spinous layers throughout skin development, whereas immunostaining has revealed MFG-E8 protein accumulation in the spinous layer. Cultured keratinocyte stem cells consistently express Mfge8-L and -S mRNAs and produce the L protein, which is primarily detectable in the culture supernatant, and the S protein, which is mostly associated with the cells. Upon Ca(2+)-stimulated differentiation, which is detected by a decrease in keratinocyte stem cell marker p63(p51) and the induction of keratin1, we have observed suppression of Mfge8, and the protein becomes localized to the cell-cell borders. Papillomas and carcinomas caused by chronic UV-B irradiation produce MFG-E8 as determined by immunostaining. Thus, undifferentiated and poorly differentiated keratinocytes produce the L and S forms of MFG-E8 during normal and pathological tissue development, probably to support an as yet unidentified membrane function.