Hair follicle morphogenesis and cycling were examined in transgenic mice that overexpress the bone morphogenetic protein (BMP) inhibitor Noggin under the control of the neuron-specific enolase promoter. The Noggin transgene was misexpressed in the proximal portion of the hair follicle, primarily the matrix cells, apart from the usual expression in neurons. Transgene expression appeared only after induction of both the primary (tylotrich) and secondary (nontylotrich) pelage hair follicles had already occurred, thus allowing examination of the role of BMP signaling in follicles that had been induced normally in the presence of BMPs. The overexpression of Noggin in these animals resulted in a dramatic loss of hair postnatally. There was an apparently normal, but shortened period of postnatal hair follicle morphogenesis, followed by premature initiation of hair follicle cycling via entry into the first catagen transformation. This resulted in a complete loss of hair shafts from the nontylotrich hair follicles in these mice while the tylotrich hair follicles were normal. The onset of anagen of the first postnatal hair follicle cycle was also accelerated in the transgenic mice. Our results show that BMP signaling is specifically required for proper proliferation and differentiation during late morphogenesis of nontylotrich hair follicles and that inhibition of this signaling pathway may be one of the triggers for the onset of catagen when the follicles are in anagen and the onset of anagen when the follicles are in telogen. Ectopic sebocyte differentiation was another hallmark of the phenotype of these transgenic mice suggesting that BMP signaling may be an important determinant of lineage selection by com- Hair follicle development involves a highly coordinated series of bidirectional epithelial-mesenchymal interactions. Because hair follicle morphogenesis is significantly affected by the sensory and autonomic innervation as well as the pigment-producing melanocytes, this miniorgan has been viewed as an epithelial-mesenchymalneuroectodermal unit.1,2 Hair follicle induction occurs with the appearance of a thickening of the embryonic ectoderm called the ectodermal placode as a result of an initial mesodermal signal. The placode signals condensation of the underlying mesoderm to form the future dermal papilla.3,4 A second signal from the condensed mesoderm then induces proliferation of the overlying ectodermal placode allowing it to grow downwards eventually surrounding the mesenchymal condensation. The latter forms the dermal papilla, the permanent mesenchymal component of the hair follicle. The basic structure of the mature hair follicle then forms by systematic differentiation of the proliferating keratinocytes, producing the outer root sheath (ORS), which is contiguous with the basal layer of the epidermis, three concentric cylinders constituting the inner root sheath (IRS) and the medulla, cortex, and cuticle of the hair shaft at the center. The sebaceous gland soon develops as an appendage to the upper part of the...