DeltaNp63alpha is a nuclear transcription factor that maintains epithelial progenitor cell populations, is overexpressed in several epithelial cancers, and can negatively regulate apoptosis. However, the mechanisms by which DeltaNp63alpha promotes cell survival are unclear. DeltaNp63alpha has been reported to act as a transcriptional repressor, but specific target genes directly repressed by DeltaNp63alpha remain unidentified. Here, we present evidence that DeltaNp63alpha functions to negatively regulate the proapoptotic protein IGFBP-3. Disruption of p63 expression in squamous epithelial cells increases IGFBP-3 expression, whereas ectopic expression of DeltaNp63alpha down-regulates IGFBP-3. DeltaNp63alpha binds to sites in the IGFBP-3 gene in vivo and can modulate transcription through these sites. Furthermore, DeltaNp63alpha and IGFBP-3 expression patterns are inversely correlated in normal squamous epithelium and squamous cell carcinomas. These data suggest that IGFBP-3 is a target of transcriptional repression by DeltaNp63alpha and that this repression represents a mechanism by which tumors that overexpress p63 may be protected from apoptosis.