During early human placental development, the conceptus attaches itself to the uterus through cytotrophoblast invasion. Invasive cytotrophoblast cells differentiate from precursor villous cytotrophoblasts, but the essential regulating factors in this process are unknown. Basic helix-loop-helix (bHLH) transcription factor dimers are essential regulators of mouse trophoblast development. We therefore examined the importance of this family of factors in the human placenta. In many cell lineages, bHLH factors are sequestered by members of the Id family, HLH proteins that lack the basic DNA binding domain (Inhibitor of DNA binding proteins (Id-1 to Id-4)). During differentiation of some tissues, Id expression declines, allowing bHLH factors to dimerize, bind DNA and trans-activate lineage-specific genes. To begin to study the role of bHLH transcription factors in human placental development, we first characterized Id expression in cytotrophoblast cells. The cells expressed Id-3 constitutively; Id-2 was downregulated, at the mRNA and protein levels, as the cells differentiated in culture and in situ, respectively. In cases when cytotrophoblast differentiation was compromised (in placentas from women with preeclampsia, or in cells grown under hypoxic conditions in culture), Id-2 expression was maintained. To assess the functional relevance of these correlations, we used an adenovirus vector to maintain Id-2 protein expression in cultured cytotrophoblasts. Compared to control (lacZ-expressing) cells, cytotrophoblasts transduced to constitutively express Id-2 retained characteristics of undifferentiated cells: α1 integrin expression was low and cyclin B expression was retained. Furthermore, invasion through Matrigel was partially inhibited and migration was strikingly enhanced in Id-2-expressing cells. These results suggest that Id-2 and the bHLH factors that it partners play important roles in human cytotrophoblast development.