The epidermis is a dynamic, continually renewing structure that provides the organism with a life-sustaining interface with the environment. The major cell type of the epidermis, the epidermal keratinocyte, undergoes a complex and carefully choreographed program of differentiation. Aberrations in this process result in the genesis of a variety of debilitating and life-threatening diseases. In the present paper, we discuss the keratinocyte differentiation program and the exogenous agents that regulate differentiation. We describe the marker genes that have been utilized to study the process of gene regulation in epidermis. We describe the keratin proteins and studies that have identified keratin mutations that cause epidermal disease. We present recent information on regulation of keratinocyte gene expression and attempt to summarize current knowledge on the role of transcription factors in this process. We also discuss the process of cornified envelope assembly and the structure and function of the proteins that are thought to be precursors of this structure.