Terminally differentiated stratified squamous epithelium forms a lining of the plasma membrane called the cornified cell envelope, a thick layer of several covalently cross-linked precursor proteins including involucrin, small proline-rich proteins, and loricrin. Their cross-linking isodipeptide bonds are formed by epidermal transglutaminases 1–3. Material from lamellar granules is attached on the extracellular surface of corneocytes during the keratinization process. The formation of cornified cell envelope and sequential expression of major cornified cell envelope precursor proteins, transglutaminases, and 25 kDa lamellar granule-associated protein were studied in human embryonic and fetal skin. Ultrastructurally, membrane thickening has already started in periderm cells of the two-layered epidermis and an electron-dense, thickened cell envelope similar to cornified cell envelope in adult epidermis is observed in periderm cells at the three-layered and later stages of skin development. In the two-layered epidermis (49–65 d estimated gestational age), immunoreactivities of involucrin, small proline-rich proteins, all the transglutaminases, and lamellar granule-associated protein were present only in the periderm. In the three-layered epidermis and thereafter (66–160 d estimated gestational age), loricrin became positive in the periderm cells, transglutaminases extended to the entire epidermis, and lamellar granule-associated protein was detected in intermediate cells as well as periderm cells. Immunoelectron microscopy demonstrated that both major cornified cell envelope precursor proteins, involucrin and loricrin, were restricted to the cornified cell envelope in periderm cells at this stage of development. After 160 d estimated gestational age, the periderm had disappeared and cornified cell envelope proteins and lamellar granule-associated proteins were expressed in the spinous, granular, and cornified cells and transglutaminases were detected in the entire epidermis. These findings indicate that cornified cell envelope precursor proteins, transglutaminases, and lamellar granule-associated proteins are expressed in coordination in periderm cells during human epidermal development and suggest that periderm cells form cornified cell envelope in the process of regression.