A physical and functional interaction between the Ca(2+)-binding protein Mts1 (S100A4) and the tumor suppressor p53 protein is shown here for the first time. We demonstrate that Mts1 binds to the extreme end of the C-terminal regulatory domain of p53 by several in vitro and in vivo approaches: co-immunoprecipitation, affinity chromatography, and far Western blot analysis. The Mts1 protein in vitro inhibits phosphorylation of the full-length p53 and its C-terminal peptide by protein kinase C but not by casein kinase II. The Mts1 binding to p53 interferes with the DNA binding activity of p53 in vitro and reporter gene transactivation in vivo, and this has a regulatory function. A differential modulation of the p53 target gene (p21/WAF, bax, thrombospondin-1, and mdm-2) transcription was observed upon Mts1 induction in tet-inducible cell lines expressing wild type p53. Mts1 cooperates with wild type p53 in apoptosis induction. Our data imply that the ability of Mts1 to enhance p53-dependent apoptosis might accelerate the loss of wild type p53 function in tumors. In this way, Mts1 can contribute to the development of a more aggressive phenotype during tumor progression.