There is controversy as to whether esophageal squamous dysplasia is a pre-cancerous lesion or a non-cancerous lesion. In this study, we conducted an immunohistochemical investigation of cyclin D1, retinoblastoma (Rb), p16INK4 and p27KIP1 expression in 36 squamous dysplasias and 34 early squamous cell carcinomas of the esophagus. The frequency of cyclin D1 overexpression was similar in dysplasias and early cancers (30% vs. 35%). Loss of p16INK4 and p27KIP1 expression was less frequent in dysplasias than in early cancers (p=0.005 and 0.001, respectively). Loss of Rb protein expression was not detected in dysplasia and rarely observed in early cancer (7%). The proliferation cell nuclear antigen index increased from moderate dysplasia to mucosal invasive carcinoma and was correlated significantly with the expression of cyclin D1, p16INK4 and p27KIP1 (p=0.0001, 0.003, and 0.007, respectively). Thus, this study found that cyclin D1 overexpression starts early in dysplasia and could be a useful marker for its malignant potentiality while reduction of p16INK4 and p27KIP1 occurs during the transformation from dysplasia to cancer. These findings suggest that esophageal dysplasia should be treated as a precancerous lesion.