The major epithelial cell types lining the intestine comprise a perpetually self-renewing population of cells that differentiate continuously from a stem cell in the intestinal crypts. Secretin-producing enteroendocrine cells represent a nondividing subpopulation of intestinal epithelial cells, suggesting that expression of the hormone is coordinated with cell cycle arrest during the differentiation of this cell lineage. Here we report that the basic helix-loop-helix protein BETA2 associates functionally with the coactivator, p300 to activate transcription of the secretin gene as well as the gene encoding the cyclin-dependent kinase inhibitor p21. Overexpression of BETA2 in cell lines induces both cell cycle arrest and apoptosis suggesting that BETA2 may regulate proliferation of secretin cells. Consistent with this role, we observed both reentry of normally quiescent cells into the cell cycle and disrupted cell number regulation in the small intestine of BETA2 null mice. Thus, BETA2 may function to coordinate transcriptional activation of the secretin gene, cell cycle arrest, and cell number regulation, providing one of the first examples of a transcription factor that controls terminal differentiation of cells in the intestinal epithelium.