By means of differential RNA display, we have isolated a cDNA corresponding to transcripts that are down-regulated upon differentiation of the goblet cell-like HT-29-M6 human colon carcinoma cell line. These transcripts encode proteins originally identified as CROC-1 on the basis of their capacity to activate transcription of c-fos. We show that these proteins are similar in sequence, and in predicted secondary and tertiary structure, to the ubiquitin-conjugating enzymes, also known as E2. Despite the similarities, these proteins lack a critical cysteine residue essential for the catalytic activity of E2 enzymes and, in vitro, they do not conjugate or transfer ubiquitin to protein substrates. These proteins constitute a distinct subfamily within the E2 protein family and are highly conserved in phylogeny from yeasts to mammals. Therefore, we have designated them UEV (ubiquitin-conjugating E2 enzyme variant) proteins, defined as proteins similar in sequence and structure to the E2 ubiquitin-conjugating enzymes but lacking their enzymatic activity (HW/GDB-approved gene symbol, UBE2V). At least two human genes code for UEV Proteins, and one of them, located on chromosome 20q13.2, is expressed as at least four isoforms, generated by alternative splicing. All human cell types analyzed expressed at least one of these isoforms. Constitutive expression of exogenous human UEV in HT-29-M6 cells inhibited their capacity to differentiate upon confluence and caused both the entry of a larger proportion of cells in the division cycle and an accumulation in G2-M. This was accompanied with a profound inhibition of the mitotic kinase, cdk1. These results suggest that UEV proteins are involved in the control of differentiation and could exert their effects by altering cell cycle distribution.