Interleukin-1 is a proinflammatory and immunomodulatory cytokine that plays a crucial role in inflammatory diseases of the skin, including bacterial infections, bullous diseases, UV damage, and especially psoriasis. To characterize the molecular effects of IL-1 in epidermis, we defined the transcriptional changes in human epidermal keratinocytes 1, 4, 24, and 48 h after treatment with IL-1alpha. IL-1 significantly regulated 388 genes, including genes associated with proteolysis, adhesion, signal transduction, proliferation, and epidermal differentiation. IL-1 induces many genes that have antimicrobial function. Secreted cytokines, chemokines, growth factors, and their receptors are the prominent targets of IL-1 regulation, including IL-8, IL-19, elafin, C3, and S100A proteins, which implicate IL-1 in the pathogenesis of inflammatory diseases. IL-1 induced not only proliferation-associated genes but also differentiation marker genes such as transglutaminase-1 and involucrin, which suggests that IL-1 plays an important role in the aberrant proliferation and differentiation seen in psoriasis. Correlation of IL-1 regulated genes with the TNFalpha and IFNgamma regulated ones showed more similarities between IL-1 and TNFalpha than IL-1 and IFNgamma, whereas Oncostatin-M (OsM) affected a largely unrelated set of genes. IL-1 regulates many genes previously shown to be specifically over-expressed in psoriasis. In summary, IL-1 regulates a characteristic set of genes that define its specific contribution to inflammation and aberrant differentiation in skin diseases.