Considerable progress has been made in characterizing epidermal stem cells by microarray analysis of FACS-selected populations. One limitation of this approach is that the gene expression profiles represent the average of the cell population, potentially masking cellular heterogeneity of functional significance. To overcome this problem, we have performed single-cell expression profiling. We have generated cDNA libraries from single human epidermal cells, designated as stem or transit-amplifying cells on the basis of Delta1 and melanoma-associated chondroitin sulfate proteoglycan expression. Of the 14 putative stem cell markers identified, we selected one, the EGF receptor antagonist leucine-rich repeats and immunoglobulin-like domains 1 (Lrig1), for further study. Lrig1 was expressed in groups of basal cells in human interfollicular epidermis previously identified as enriched for stem cells. Overexpression of Lrig1 decreased keratinocyte proliferation but did not affect the proportion of stem and transit-amplifying cells, as judged by clonal growth characteristics. Down-regulation of Lrig1 using siRNA increased cell-surface EGF receptor levels, enhanced activation of downstream pathways, and stimulated proliferation. Lrig1 acted in part by negatively regulating the Myc promoter. We propose that Lrig1 maintains epidermal stem cells in a quiescent nondividing state, and that Lrig1 down-regulation triggers proliferation.