Pulmonary arterial hypertension (PAH) is a progressive lung disease caused by thickening of the pulmonary arterial wall and luminal obliteration of the small peripheral arteries leading to increase in vascular resistance which elevates pulmonary artery pressure that eventually causes right heart failure and death. We have previously shown that transcription factor Msx1 (mainly expressed during embryogenesis) is strongly upregulated in transformed lymphocytes obtained from PAH patients, especially IPAH. Under pathological conditions, Msx1 overexpression can cause cell dedifferentiation or cell apoptosis. We hypothesized that Msx1 overexpression contributes to loss of small pulmonary vessels in PAH. In IPAH lung, MSX1 protein localization was strikingly increased in muscularized remodeled pulmonary vessels, whereas it was undetectable in control pulmonary arteries. We developed a transgenic mouse model overexpressing MSX1 (MSX1OE) by about 4-fold and exposed these mice to normoxic, sugen hypoxic (3 weeks) or hyperoxic (100% 02 for 3 weeks) conditions. Under normoxic conditions, compared to controls, MSX1OE mice demonstrated a 30-fold and 2-fold increase in lung Msx1 mRNA and protein expression, respectively. There was a significant retinal capillary dropout (p < 0.01) in MSX1OE mice, which was increased further (p < 0.03) with sugen hypoxia. At baseline, the number of pulmonary vessels in MSX1OE mice was similar to controls. In sugen-hypoxia-treated MSX1OE mice, the number of small (0–25 uM) and medium (25–50 uM) size muscularized vessels increased approximately 2-fold (p < 0.01) compared to baseline controls; however, they were strikingly lower (p < 0.001) in number than in sugen-hypoxia-treated control mice. In MSX1OE mouse lung, 104 genes were upregulated and 67 genes were downregulated compared to controls. Similarly, in PVECs, 156 genes were upregulated and 320 genes were downregulated from siRNA to MSX1OE, and in PVSMCs, 65 genes were upregulated and 321 genes were downregulated from siRNA to MSX1OE (with control in the middle). Many of the statistically significant GO groups associated with MSX1 expression in lung, PVECs, and PVSMCs were similar, and were involved in cell cycle, cytoskeletal and macromolecule organization, and programmed cell death. Overexpression of MSX1 suppresses many cell-cycle-related genes in PVSMCs but induces them in PVECs. In conclusion, overexpression of Msx1 leads to loss of pulmonary vessels, which is exacerbated by sugen hypoxia, and functional consequences of Msx1 overexpression are cell-dependent.