Peripheral myelin protein 22 (PMP22) is expressed in many tissues but mainly by Schwann cells as a component of compact myelin of the peripheral nervous system (PNS). Mutations affecting PMP22 are associated with hereditary motor and sensory neuropathies. Although these phenotypes are restricted to the PNS, PMP22 is thought to play a dual role in myelin formation and in cell proliferation. We describe the cloning and characterization of epithelial membrane protein-1 (EMP-1), a putative four-transmembrane protein of 160 amino acids with 40% amino acid identity to PMP22. EMP-1 and PMP22 are co-expressed in most tissues but with differences in relative expression levels. EMP-1 is most prominently found in the gastrointestinal tract, skin, lung, and brain but not in liver. In the corpus gastricum, EMP-1 protein can be detected in epithelial cells of the gastric pit and isthmus of the gastric gland in a pattern consistent with plasma membrane association. EMP-1 and PMP22 mRNA levels are inversely regulated in the degenerating rat sciatic nerve after injury and by growth arrest in NIH 3T3 fibroblasts. The discovery of EMP-1 as the second member of a novel gene family led to the identification of the lens-specific membrane protein 20 (MP20) as a third but distant relative. The proteins of this family are likely to serve similar functions possibly related to cell proliferation and differentiation in a variety of cell types.