The Elav-like proteins are specific mRNA-binding proteins that regulate mRNA stability. The neuronal members of this family (HuD, HuC, and Hel-N1) are required for neuronal differentiation. In this report, using purified HuD protein we have localized a high affinity HuD binding site to a 42-nucleotide region within a U-rich tract in the 3'-untranslated region p21(waf1) mRNA. The binding of HuD to this site is readily displaced by an RNA oligonucleotide encoding the HuD binding site of c-fos. The sequence of this binding site is well conserved in human, mouse, and rat p21(waf1) mRNA. p21(waf1) is an inhibitor of cyclin-dependent kinases and proliferating cell nuclear antigen and induces cell cycle arrest at G1/S, a requisite early step in cell differentiation. The identification of an Elav-like protein binding site in the 3'-untranslated region of p21(waf1) provides a novel link between the induction of differentiation, mRNA stability, and the termination of the cell cycle.