Jun N-terminal kinases (JNKs) are serine-threonine kinases that play a critical role in the regulation of cell growth and differentiation. We previously observed that JNK activity is suppressed by all-trans-retinoic acid (t-RA), a ligand for retinoic acid nuclear receptors (RARs), in normal human bronchial epithelial cells, which are growth inhibited by t-RA. In this study, we investigated the mechanism by which t-RA inhibits JNK and the possibility that this signaling event is blocked in non-small cell lung cancer (NSCLC) cells. Virtually all NSCLC cell lines are resistant to the growth-inhibitory effects of t-RA, and a subset of them have a transcriptional defect specific to retinoid nuclear receptors. We found that in NSCLC cells expressing functional retinoid receptors, serum-induced JNK phosphorylation and activity were inhibited by t-RA in a bimodal pattern, transiently within 30 min and in a sustained fashion beginning at 12 h. Retinoid receptor transcriptional activation was required for the late, but not the early, suppression of JNK activity. t-RA inhibited serum-induced JNK activity by blocking mitogen-activated protein (MAP) kinase kinase 4-induced signaling events. This effect of t-RA was phosphatase dependent and involved an increase in the expression of the dual-specificity MAP kinase phosphatase 1 (MKP-1). t-RA did not activate MKP-1 expression or inhibit JNK activity in a NSCLC cell line with retinoid receptors that are refractory to ligand-induced transcriptional activation. These findings provide the first evidence that t-RA suppresses JNK activity by inhibiting JNK phosphorylation. Retinoid receptor transcriptional activation was necessary for the sustained inhibition of JNK activity by t-RA, and this signaling event was disrupted in NSCLC cells with retinoid receptors that are refractory to ligand-induced transcriptional activation.