Dermal EZH2 orchestrates dermal differentiation and epidermal proliferation during murine skin development

Skin development and patterning is dependent on factors that regulate the stepwise differentiation of dermal fibroblasts concomitant with dermal-epidermal reciprocal signaling, two processes that are poorly understood. Here we show that dermal EZH2, the methyltransferase enzyme of the epigenetic Polycomb Repressive Complex 2 (PRC2), is a new coordinator of both these processes. Dermal EZH2 activity is present during dermal fibroblast differentiation and is required for spatially restricting Wnt/β-catenin signaling to reinforce dermal fibroblast cell fate. Later in development, dermal EZH2 regulates the expression of reticular dermal markers and initiation of secondary hair follicles. Embryos lacking dermal Ezh2 have elevated epidermal proliferation and differentiation that can be rescued by small molecule inhibition of retinoic acid (RA) signaling. Together, our study reveals that dermal EZH2 is acting like a rheostat to control the levels of Wnt/β-catenin and RA signaling to impact fibroblast differentiation cell autonomously and epidermal keratinocyte development non-cell autonomously, respectively.