Retinoids are powerful regulators of epidermal cell growth and differentiation and are widely used in the prevention and treatment of skin disorders and cancers in humans. Since many of the effects of retinoids on cell growth and differentiation are mediated by nuclear retinoid receptors (RARs and RXRs), we were interested in determining RAR and RXR gene expression during mouse skin tumor progression. The two-stage system of mouse skin carcinogenesis was used to generate papillomas and carcinomas, and the different stages of malignant progression (papillomas, differentiated squamous cell carcinomas, undifferentiated squamous cell carcinomas, and spindle cell carcinomas) were characterized in each tumor by specific keratin expression prior to receptor characterization. Using in situ hybridization analysis, we show that the two major RAR isoforms (alpha 1 and gamma 1), which account for most of RARs in the skin, were expressed in both the basal and suprabasal layers in mouse epidermis. In contrast, RXR alpha transcripts were compartmentalized to the basal cell layers and concentrated in hair follicles. During skin tumor progression, RAR (alpha 1 and gamma 1) transcripts were down-modulated in malignant tumor cells, whereas RXR (alpha and beta) transcript expression was expanded in papillomas and carcinomas as the number of undifferentiated cells also increased. RXR gamma was not detected in the skin or at any stage during skin tumor progression. Spindle cell tumors lacked markers of the keratinocyte phenotype and lost RAR expression, yet retained expression of RXR alpha and beta. The increased abundance of transcripts for RXRs and decreased presence of RARs in skin tumor progression may favor other nuclear signal transduction pathways requiring RXR for heterodimer formation and contribute to phenotypic progression of cancer cells.