Retinoids play an important role in pathogenesis of liver diseases. To clarify the functional role of retinoic acid (RA) in liver, we developed transgenic mice (Tg) which express the dominant negative form of retinoic acid receptor (RARE) in liver. Here, we report that proliferation of hepatocytes in RARE Tg is greatly enhanced and that cyclin E is up-regulated in RARE Tg. Liver weight, liver/body weight, and proliferating cell nuclear antigen (PCNA) labeling index in RARE Tg were significantly increased, compared to those in wild-type mice (P < 0.01, each). Cell cycle analysis showed that 2N DNA content cells and aneuploid area between 2N and 4N DNA, reflecting S phase cells, were significantly increased in RARE Tg, compared to wildtype mice (P < 0.01, each). Of G1 phase-related proteins including cyclins, cyclin-dependent protein kinases (CDKs) and cyclin-dependent protein kinase inhibitors (CKIs), cyclin E mRNA and protein was upregulated in liver from RARE Tg by reverse transcription polymerase chain reaction and Western blot analysis. Furthermore, the immunoprecipitation with anti-cdk2 antibody, followed by Western blot analysis with anti-cyclin E antibody indicated that cyclin E/cdk2 complex is increased in liver of RARE Tg. The results of the present study suggest that cyclin E in association with cdk2 governs cell cycle progression through G1 in hepatocytes where function of RA is inhibited.