Amplification and/or overexpression of the Mdm2 oncogene occurs in many human cancers. Mdm2 promotes cellular proliferation, interferes with apoptosis, and induces tumor formation through the negative regulation of the p53 tumor suppressor. More than thirty percent of human tumors overexpressing Mdm2 also present with alternatively spliced Mdm2 isoforms that cannot directly bind p53. The presence of Mdm2 isoforms in tumors correlates with a higher tumor grade and a poorer prognosis for the patient. To investigate the function of Mdm2 isoforms in tumorigenesis, we have isolated a number of Mdm2 splice forms from tumors obtained from Mdm2-transgenic mice and find that the most frequently observed splice form in human tumors, Mdm2-b, is conserved in mice. Although the Mdm2-b protein is incapable of binding to p53 and is unable to localize to the nucleus, we demonstrate that Mdm2-b promotes cell growth in NIH3T3 cells, Rb-deficient, p19-deficient, and p53-deficient primary cells. We also show that Mdm2-b inhibits apoptosis in response to serum withdrawal and restimulation, doxorubicin treatment, and TNF-alpha administration. Mdm2-b induces foci formation in vitro and directly contributes to tumor formation in GFAP-Mdm2 transgenic mice. We propose that Mdm2-b promotes tumor growth by upregulating RelA (P65) protein levels and activity in a p53-independent manner. To better understand additional functions of Mdm2 that are p53-dependent, we have generated an Mdm2 conditional mouse model. Using primary mouse embryonic fibroblasts derived from Mdm2 conditional mice, we demonstrate that p21 is required for p53-dependent apoptosis initiated by Mdm2 loss. In support of this observation, we also note that p21-loss partially rescues embryonic lethality of Mdm2 null mice. We further show that p21-loss partially rescues the embryonic lethality caused by the loss of the Mdm2 family member, Mdm4. We address the possibility that Mdm2 and Mdm4 may play redundant roles during embryonic development and find that Mdm2 overexpression fully rescues the embryonic lethality resulting from Mdm4 loss. Our findings demonstrate that both Mdm2 and Mdm4 play critical roles in modulation of the p53 tumor suppressor pathway and that their deregulation can result in tumor formation through both p53-dependent and independent pathways.