Chloracne is commonly observed in people exposed to dioxins, yet the mechanism of toxicity is not well understood. The pathology of chloracne is characterized by hyperkeratinization of the interfollicular squamous epithelium, hyperproliferation and hyperkeratinization of hair follicle cells as well as a metaplastic response of the ductular sebum secreting sebaceous glands. In vitro studies using normal human epidermal keratinocytes to model interfollicular human epidermis demonstrate a 2,3,7,8-tetrachlorodibenzo-p-dioxin (TCDD)-mediated acceleration of differentiation and increase in gene expression of several prodifferentiation genes, including filaggrin (FLG). Here, we demonstrated that the TCDD-activated aryl hydrocarbon receptor (AHR) bound a small fragment of DNA upstream of the transcriptional start sites of the FLG gene, containing one of two candidate xenobiotic response elements (XREs). Reporter assays using the promoter region of FLG containing the two putative XREs indicated that the increase in this messenger RNA (mRNA) was due to TCDD-mediated enhanced transcription, which was lost when both XREs were mutated. As FLG is part of the human epidermal differentiation complex (EDC) found on chromosome 1, we measured mRNAs from an additional 18 EDC genes for their regulation by TCDD. Of these genes, 14 were increased by TCDD. Immunoblot assays demonstrated that the proteins of FLG as well as that of another prodifferentiation gene, small proline rich protein 2, were increased by TCDD. In utero exposure to TCDD accelerated the formation of the epidermal barrier in the developing mouse fetus by approximately 1 day. These results indicate that the epidermal permeability barrier is a functional target of the TCDD-activated AHR.