The Notch pathway plays an important role in regulating epidermal differentiation. Notch ligands, receptors and effectors are expressed in a complex and dynamic pattern in embryonic and adult skin. Genetic ablation or activation of the pathway reveals that Notch signalling promotes differentiation of the hair follicle, sebaceous gland and interfollicular epidermal lineages and that Notch acts as an epidermal tumour suppressor. Notch signalling interacts with a range of other pathways to fulfil these functions and acts via RBP-Jkappa dependent and independent mechanisms. The effects on differentiation can be cell autonomous and non-autonomous, and Notch contributes to stem cell clustering via modulation of cell adhesion.