WT1 was originally identified as a Wilms' tumor suppressor gene, but it may have oncogenic potential in leukemia and in some solid tumors. WT1 is a transcription factor that has been implicated in the regulation of target genes related to apoptosis, genitourinary differentiation, and cell cycle progression. Because induction of WT1 leads indirectly to increased p21 expression in osteosarcoma cells, we investigated the possibility that other genes involved in the G(1)/S phase transition might also be WT1 targets. Cyclin E plays a crucial role in the cell cycle by activating cyclin-dependent kinase 2, which phosphorylates Rb, leading to progression from G(1) into S phase. We identified several WT1 binding sites in the cyclin E promoter. We demonstrate that WT1 binds to these sites and that in transient transfection assays WT1 represses the cyclin E promoter. This activity is dependent on the presence of a binding site located downstream of the transcription start site. In intact cells, induction of WT1 expression down-regulates cyclin E protein levels. These results provide the first demonstration that WT1 can directly modulate the expression of a gene involved in cell cycle progression.