Ada3 protein is an essential component of histone acetyl transferase containing coactivator complexes conserved from yeast to human. We show here that germline deletion of Ada3 in mouse is embryonic lethal, and adenovirus-Cre mediated conditional deletion of Ada3 in Ada3(FL/FL) mouse embryonic fibroblasts leads to a severe proliferation defect which was rescued by ectopic expression of human Ada3. A delay in G(1) to S phase of cell cycle was also seen that was due to accumulation of Cdk inhibitor p27 which was an indirect effect of c-myc gene transcription control by Ada3. We further showed that this defect could be partially reverted by knocking down p27. Additionally, drastic changes in global histone acetylation and changes in global gene expression were observed in microarray analyses upon loss of Ada3. Lastly, formation of abnormal nuclei, mitotic defects and delay in G(2)/M to G(1) transition was seen in Ada3 deleted cells. Taken together, we provide evidence for a critical role of Ada3 in embryogenesis and cell cycle progression as an essential component of HAT complex.