Histone deacetylases (HDACs) catalyze the removal of acetyl groups on the amino-terminal lysine residues of core nucleosomal histones. This activity is associated generally with transcriptional repression. We have reported previously that inhibition of HDAC activity by hydroxamic acid-based hybrid polar compounds, such as suberoylanilide hydroxamic acid (SAHA), induces differentiation and/or apoptosis of transformed cells in vitro and inhibits tumor growth in vivo. SAHA is a potentially new therapeutic approach to cancer treatment and is in Phase I clinical trials. In several tumor cell lines examined, HDAC inhibitors alter the expression of less than 1% of expressed genes, including the cell cycle kinase inhibitor p21^WAF1. In T24 bladder carcinoma cells, SAHA induces up to a 9-fold increase in p21^WAF1 mRNA and protein, which is, at least in part, because of an increase in the rate of transcription of the gene. SAHA causes an accumulation of acetylated histones H3 and H4 in total cellular chromatin by 2 h, which is maintained through 24 h of culture. An increase in the accumulation of acetylated H3 and H4 was detected throughout the p21^WAF1 promoter and the structural gene after culture with SAHA. The level of histone acetylation did not change in chromatin associated with the actin and p27 genes, and their mRNA expression was not altered during culture of T24 cells with SAHA. Thus, the present findings indicate that the induction of p21^WAF1 by SAHA is regulated, at least in part, by the degree of acetylation of the gene-associated histones and that this induced increase in acetylation is gene selective.