Cadherin-16 was originally identified as a tissue-specific cadherin present exclusively in kidney. Only recently, Cadherin-16 has been detected also on the plasma membrane of mouse thyrocytes. This last finding prompted us to note that the expression profile of Cadherin-16 resembles that of the transcription factor Pax8, a member of the Pax (paired-box) gene family, predominantly expressed in the developing and adult kidney and thyroid. Pax8 has been extensively characterized in the thyroid and shown to be a master gene for thyroid development and differentiation. In this study, we determined the role of the transcription factor Pax8 in the regulation of Cadherin-16 expression. We demonstrate that the Cadherin-16 minimal promoter is transcriptionally active in thyroid cells as well as in kidney cells, that Pax8 is able to activate transcription from a Cadherin-16 promoter reporter construct, and more importantly, that indeed Pax8 is able to bind in vivo the Cadherin-16 promoter region. In addition, by means of Pax8 RNA interference in thyroid cells and by analyzing Pax8 null mice, we demonstrate that Pax8 regulates also in vivo the expression of Cadherin-16. Finally, we reveal that the expression of Cadherin-16 is TSH dependent in FRTL-5 thyroid cells and significantly reduced in mouse thyroid carcinomas. Therefore, we conclude that Cadherin-16 is a novel downstream target of the transcription factor Pax8, likely since the early steps of thyroid development, and that its expression is associated with the fully differentiated state of the thyroid cell.