Project Summary The hair cycle is an excellent model to study adult stem cell (SC) regulation by the microenvironment or niche, as it involves bouts of hair follicle (HF) regression, rest and regrowth. During regression, most HF epithelial cells die by apoptosis while the mesenchymal dermal papilla (DP) cell cluster survives and relocates from the HF base to the SCs in the permanent upper follicle. During the resting phase, signals from the DP are critical for activating the SCs to initiate regeneration of a growing HF. In contact with the DP and encasing growing HFs is the dermal sheath (DS), which we recently reported is a specialized smooth muscle essential for DP relocation and follicle regression. Within the DS, a non-smooth muscle cell subpopulation was recently discovered that also survives regression and has the intriguing SC potential for regenerating the DS smooth muscle of re-growing HFs and for contributing cells to the DP lineage during hair cycling. The cells were aptly named HF dermal SCs (hfDSCs). However, the evidence for these potent cells has been largely indirect due to the lack of direct genetic targeting for hfDSC cell ablation, labeling and tracing and for gene knockouts. Our immediate goal is to overcome this roadblock for enabling direct functional hfDSC studies and answering several key questions: What is the functional requirement of hfDSCs for HF regrowth? What is their lineage contribution to the DP during normal unperturbed hair cycling? What is the hfDSC cell plasticity during wound healing? What are the molecular mechanisms that control hfDSC identity and potency? Our long-term goal is to understand how hfDSCs and DP niche cells govern SC functions and to provide a rational basis for developing future hair regenerative therapies. We have recently isolated, transcriptome-wide characterized, genetically targeted and live imaged the mature DS to uncover a key contractile role in follicle regression. We have now developed a genetic driver to study the cellular and molecular functions of their progenitors, the hfDSCs. With our preliminary data we have established the conditions to specifically and inducibly target for the first time the hfDSCs; explore their cellular dynamics; define the functional requirement of hfDSC; purify for the first time hfDSCs in their quiescent and activated states; define hfDSC-specific gene signatures; and interrogate the regulation of hfDSC identity and function. With these studies we will rigorously test the hypothesis that hfDSCs constitute a potent mesenchymal progenitor population of the HF niche. Overall, this work will establish genetic targeting of resting-phase hfDSCs, reveal their cellular turnover and lineage potential for other hair and skin mesenchymal cells and provide molecular insight into hfDSC gene regulation and function during the cycle.