Pax4, a paired-box transcription factor, is a key regulator of pancreatic islet cell growth and differentiation. Here, we report for the first time that the Pax4 protein can permeate into various cell types including pancreatic islets. The paired domain of Pax4 serves as a novel protein transduction domain (PTD). The Pax4 protein can transduce in a dose- and time-dependent manner. The cellular uptake of Pax4 PTD can be completely blocked by heparin, whereas cytochalasin D and amiloride were partially effective in blocking the Pax4 protein entry. Transduced intact Pax4 protein functions similarly to the endogenous Pax4. It inhibits the Pax6 mediated transactivation and protects Min6 cells against TNFalpha-induced apoptosis. These data suggest that Pax4 protein transduction could be a safe and valuable strategy for protecting islet cell growth in culture from apoptosis and promoting islet cell differentiation.