The serine protease inhibitor SerpinB2 (PAI-2), a major product of differentiating squamous epithelial cells, has recently been shown to bind and protect the retinoblastoma protein (Rb) from degradation. In human papillomavirus type 18 (HPV-18)-transformed epithelial cells the expression of the E6 and E7 oncoproteins is controlled by the HPV-18 upstream regulatory region (URR). Here we illustrate that PAI-2 expression in the HPV-18-transformed cervical carcinoma line HeLa resulted in the restoration of Rb expression, which led to the functional silencing of transcription from the HPV-18 URR. This caused loss of E7 protein expression and restoration of multiple E6- and E7-targeted host proteins, including p53, c-Myc, and c-Jun. Rb expression emerged as sufficient for the transcriptional repression of the URR, with repression mediated via the C/EBPbeta-YY1 binding site (URR 7709 to 7719). In contrast to HeLa cells, where the C/EBPbeta-YY1 dimer binds this site, in PAI-2- and/or Rb-expressing cells the site was occupied by the dominant-negative C/EBPbeta isoform liver-enriched transcriptional inhibitory protein (LIP). PAI-2 expression thus has a potent suppressive effect on HPV-18 oncogene transcription mediated by Rb and LIP, a finding with potential implications for prognosis and treatment of HPV-transformed lesions.