The tumor suppressor protein p53 is not only involved in defending cells against genotoxic insults but is also implicated in differentiation processes, a function that it shares with the CCAAT/enhancer-binding protein beta (C/EBPbeta). We previously reported an up-regulation of both factors in the cycle-dependent differentiation process of human endometrial stromal cells, termed decidualization. C/EBPbeta-mediated activation of a decidualization marker, the decidual prolactin promoter, was antagonized by p53. Here we report that C/EBPbeta in turn represses the transcriptional activity of p53. Competition for limiting amounts of coactivator CREB-binding protein/p300 was ruled out as the underlying mechanism of transrepression. Physical interaction between p53 and C/EBPbeta was demonstrated in vitro and in vivo and shown to depend on the C-terminal domains of both proteins. In gel shift experiments, C/EBPbeta reduced complex formation between p53 and its response element. Conversely, p53 strongly inhibited binding of endogenous C/EBPbeta from endometrial stromal cells to the C/EBP-responsive region in the decidual prolactin promoter. The observed negative cross-talk between p53 and C/EBPbeta is likely to impact expression of their respective target genes.