Hair follicles develop and are maintained by multiple rounds of inductive events involving interactions among various cell types within the follicles and the adjacent mesenchyme. Although evidence suggests that several growth factors, cell adhesion molecules, and transcriptional regulators are involved in those cell-cell interactions, the molecular mechanisms regulating each pivotal step of hair follicle development, such as formation of the hair germ, root sheath, sebaceous gland, and hair canal, remain largely unknown. In this study, we established the antagonistic monoclonal antibody APA5 against platelet-derived growth factor (PDGF) receptor-alpha (PDGFR-alpha) and used it to investigate the role of PDGFR-alpha in neonatal skin development. In addition to the dermal mesenchyme, a known site of PDGFR-alpha expression, immunohistologic staining of neonatal skin detected transient expression of PDGFR-alpha in the perinatal epidermis for several days. On the other hand, ligands for PDGFR-alpha were detected in epithelial cells and sebaceous glands of hair follicles. To determine whether this contiguous expression of PDGF and PDGFR-alpha in neonatal skin plays a functional role, we injected APA5 into neonates to block the function of PDGFR-alpha. Consistent with the PDGF/PDGFR-alpha expression in the neonatal skin, two defects were induced by this procedure. First, hair canal formation in the epidermis was severely suppressed. Second, the growth of dermal connective tissues and of hair follicles of pelage hairs was suppressed. These results indicate that PDGF signals are involved in both the epidermis-follicle interaction and the dermal mesenchyme-follicle interaction required for hair canal formation and the growth of the dermal mesenchyme, respectively.