Recent studies have demonstrated that orally administered thiazolidinedione ligands of the peroxisome proliferator-activated receptor-gamma can ameliorate clinical features of psoriasis in humans. Thiazolidinediones also inhibit the proliferation of psoriatic keratinocytes in monolayer and organ culture, and at least one of these agents (troglitazone) inhibits epidermal hyperplasia of human psoriatic skin transplanted to severe-combined immunodeficient (SCID) mice. In the present study, we show that a novel, synthetic, thiazoladinedione derivative, BP-1107 ({2-[4-(2,4-dioxo-thiazolidin-5-ylmethyl)-phenoxy]-ethyl}-methyl-amide), is capable of inhibiting psoriatic hyperplasia in the SCID mouse transplant model after topical application. Like other thiazolidinediones, BP-1107 inhibits proliferation of rapidly growing keratinocytes in monolayer culture, but compared with these agents, the effective dose of BP-1107 needed to suppress keratinocyte proliferation is much lower. Concentrations of BP-1107 that effectively inhibit keratinocyte function have no detrimental effect on dermal fibroblasts. These data suggest that effective topical antipsoriatic therapy may be provided with this agent.