Deficiency in the DNA mismatch repair (MMR) is frequently involved in various cancers. The hMSH3 gene is one of the human MMR genes whose role in bladder cancer is not known. We hypothesized that down-regulation of the hMSH3 gene might be involved in bladder cancer. In this study we analyzed this gene with regard to frame-shift mutation, single nucleotide polymorphism (SNP), a 9bp repeat in exon 1, loss of heterozygosity (LOH), immunohistochemistry, and methylation status in 102 bladder cancer samples. Immunohistochemistry revealed that hMSH3 expression in bladder cancer was significant decreased compared to normal epithelium (p<0.0001). An inverse correlation with pathological grade was found. The frame-shift mutation in the (A) 8 tract was lacking in bladder cancer. There was no significantly difference between bladder cancer samples and healthy controls' with regard to SNP and the 9bp repeat. In bladder cancer, presence of the codon 222 polymorphism, LOH, and the 9bp repeats in exon 1 had a correlation with either pathological stage or pathological grade. Presence of the codon 1036 polymorphism had significant correlation with pathological stage and a trend to correlation with pathological grade. After 5-aza-dC treatment, MSH3 expression was significantly enhanced in TCC and UMUC bladder cancer cells when compared to untreated cells. This is the first report suggesting that genetic and epigenetic alterations in the human MSH3 gene might play a significant role in the progression of bladder tumors.