Signaling mediated by activation of the transmembrane receptor Notch influences cell-fate decisions, differentiation, proliferation, and cell survival. Activated Notch reduces proliferation by altering cell-cycle kinetics and promotes differentiation in hematopoietic progenitor cells. Here, we investigated if the G(1) arrest and differentiation induced by activated mNotch1 are dependent on tumor suppressor p53, a critical mediator of cellular growth arrest. Multipotent wild-type p53-expressing (p53(wt)) and p53-deficient (p53(null)) hematopoietic progenitor cell lines (FDCP-mix) carrying an inducible mNotch1 system were used to investigate the effects of proliferation and differentiation upon mNotch1 signaling. While activated Notch reduced proliferation of p53(wt)-cells, no change was observed in p53(null)-cells. Activated Notch upregulated the p53 target p21(cip/waf) in p53(wt)-cells, but not in p53(null)-cells. Induction of the p21(cip/waf) gene by activated Notch was mediated by increased binding of p53 to p53-binding sites in the p21(cip/waf) promoter and was independent of the canonical RBP-J binding site. Re-expression of p53(wt) in p53(null) cells restored the inhibition of proliferation by activated Notch. Thus, activated Notch inhibits proliferation of multipotent hematopoietic progenitor cells via a p53-dependent pathway. In contrast, myeloid and erythroid differentiation was similarly induced in p53(wt) and p53(null) cells. These data suggest that Notch signaling triggers two distinct pathways, a p53-dependent one leading to a block in proliferation and a p53-independent one promoting differentiation.