Retinoids induce growth arrest, differentiation, and cell death in many cancer cell types. One factor determining the sensitivity or resistance to the retinoid anticancer signal is the transcriptional response of retinoid-regulated target genes in cancer cells. We used cDNA microarray to identify 31 retinoid-regulated target genes shared by two retinoid-sensitive neuroblastoma cell lines, and then sought to determine the relevance of the target gene responses to the retinoid anticancer signal. The pattern of retinoid responsiveness for six of 13 target genes (RARbeta2, CYP26A1, CRBP1, RGS16, DUSP6, EGR1) correlated with phenotypic retinoid sensitivity, across a panel of retinoid-sensitive or -resistant lung and breast cancer cell lines. Retinoid treatment of MYCN transgenic mice bearing neuroblastoma altered the expression of five of nine target genes examined (RARbeta2, CYP26A1, CRBP1, DUSP6, PLAT) in neuroblastoma tumour tissue in vivo. In retinoid-sensitive neuroblastoma, lung and breast cancer cell lines, direct inhibition of retinoid-induced RARbeta2 expression blocked induction of only one of eight retinoid target genes (CYP26A1). DNA demethylation, histone acetylation, and exogenous overexpression of RARbeta2 partially restored retinoid-responsive CYP26A1 expression in RA-resistant MDA-MB-231 breast, but not SK-MES-1 lung, cancer cells. Combined, rather than individual, inhibition of DUSP6 and RGS16 was required to block retinoid-induced growth inhibition in neuroblastoma cells, through phosphorylation of extracellular-signal-regulated kinase. In conclusion, sensitivity to the retinoid anticancer signal is determined in part by the transcriptional response of key retinoid-regulated target genes, such as RARbeta2, DUSP6, and RGS16.