PRH (proline-rich homeodomain protein)/Hex is important in the control of cell proliferation and differentiation. We have shown previously that PRH contains two domains that can bring about transcriptional repression independently; the PRH homeodomain represses transcription by binding to TATA box sequences, whereas the proline-rich N-terminal domain can repress transcription by interacting with members of the Groucho/TLE (transducin-like enhancer of split) family of co-repressor proteins. The proteasome is a multi-subunit protein complex involved in the processing and degradation of proteins. Some proteasome subunits have been suggested to play a role in the regulation of transcription. In the present study, we show that PRH interacts with the HC8 subunit of the proteasome in the context of both 20 and 26 S proteasomes. Moreover, we show that PRH is associated with the proteasome in haematopoietic cells and that the proline-rich PRH N-terminal domain is responsible for this interaction. Whereas PRH can be cleaved by the proteasome, it does not appear to be degraded rapidly in vitro or in vivo, and the proteolytic activity of the proteasome is not required for transcriptional repression by PRH. However, proteasomal digestion of PRH can liberate truncated PRH proteins that retain the ability to bind to DNA. We discuss these findings in terms of the biological role of PRH in gene regulation and the control of cell proliferation.