Induced pluripotent stem (iPS) cells were established from mouse somatic fibroblasts through reprogramming by transduction of four transcription factors (Oct3/4, Sox2, Klf5, c-myc). Mouse iPS cells have pluripotency of differentiation in vivo. However, it has not been demonstrated whether mouse iPS cells can be differentiated into keratinocytes in vitro. The aim of this study was to examine whether mouse embryonic stem (ES) cell differentiation system into epidermal keratinocytes can be successfully applied to mouse iPS cells. Epidermal keratinocytes can be differentiated from mouse ES cells when cultured on stromal PA6 cells in a culture medium containing bone morphogenetic protein-4 (BMP-4) and fetal calf serum (FCS) for a defined period. By using this ES cell differentiation for iPS cell differentiation methodology, iPS cells were successfully differentiated into keratinocytes, as immunohistochemistry showed that 42% of the cells were positive for keratin 14 (Krt14) at 11 days after the induction of differentiation. The frequency of this differentiation of iPS cells was comparable to the frequency of the differentiation of keratinocytes from ES cells (47%). To clarify the further differentiation ability of these cells, we cultured the Krt14⁺ cells in high Ca²⁺ medium. Immunohistochemistry revealed that keratin 10 (Krt10) expression level was augmented by culture in high Ca²⁺ medium. Finally, transplantation of the Krt14⁺ cells with dermal papilla cells onto nude mouse back skin induced hair shaft elongation, suggesting its use for therapeutics. These results showed that the differentiation properties of iPS cells are almost identical to those of ES cells and that differentiated Krt14⁺ cells have similar characteristics and differentiation potentials to those of mouse epidermal keratinocytes. This differentiation system from iPS cells may lead to the development of a novel approach for a regeneration of hair follicles without any vigorous ethical controversy, confronted in the case of ES cells.