Dermal papilla (DEPA) cells are resident at the base of hair follicles and are fundamental to hair growth and development. Cultured DEPA cells, in contrast to normal fibroblast cells, are capable of inducing de novo hair follicle growth in vivo. By differential screening of a DEPA cDNA library, we have demonstrated that dermal papilla cells are different from fibroblasts at the molecular level. We further studied these cells by random sequencing of 5130 clones from the DEPA cDNA library. Fifty percent had a BLASTX E value < or =1 x 10(-25). Twenty-one percent had similarity to proteins involved in cell structure/motility with 4 of the top 10 most abundant clones encoding extracellular matrix proteins. Clones encoding growth factor molecules were also abundant. The remaining 50.7% of clones had low similarity scores, demonstrating many novel molecules. For example, we identified a new CTGF family member, the rat homologue of Elm1.