We have identified a gene that is highly expressed in the androgen-dependent prostate cancer cell line, LNCaP. Sequence analysis revealed that it was identical to a recently cloned gene designated TMEFF2, which encodes a transmembrane protein containing an epidermal growth factor (EGF)-like motif and two follistatin domains. This gene was highly expressed only in primary samples of normal prostate and prostate cancer as well as normal brain. Expression of the gene was controlled by androgen as shown by dihydrotestosterone markedly increasing TMEFF2 expression in LNCaP cells. Also, androgen-dependent human prostate cancer xenografts (CWR22) expressed high levels of TMEFF2 and these levels markedly decreased by day 10 after castration of the mice. Furthermore, a large number of androgen-dependent xenografts (CWR22, LuCaP-35, LAPC-4AD, LAPC-9AD) exhibited higher levels of TMEFF2 mRNA than androgen-independent xenografts (CWR22R, LAPC-3AI, LAPC-4AI, LAPC-9AI). Ectopic expression of TMEFF2 in DU145 and PC3 cells resulted in their prominent inhibition of growth. Taken together, the results demonstrate that TMEFF2 is a androgen-regulated gene, which can suppress growth of prostate cancer cells and our xenograft data show that escape of prostate cancer cells from androgen modulation causes them to decrease their expression of this gene, which may result in their more malignant behavior.