Inhibitor of differentiation‐1 (Id‐1) is a member of helix–loop–helix (HLH) family of proteins that regulate gene transcription through their inhibitory binding to basic‐HLH transcription factors. Similarly to other members of this family, Id‐1 is involved in the repression of cell differentiation and activation of cell growth. The dual function of Id‐1, inhibition of differentiation, and stimulation of cell proliferation, might be interdependent, as cell differentiation is generally coupled with the exit from the cell cycle. Fibroblast growth factor‐2 (FGF‐2) has been reported to play multiple roles in different biological processes during development of the central nervous system (CNS). In addition, FGF‐2 has been described to induce “neuronal‐like” differentiation and trigger apoptosis in neuroblastoma SK‐N‐MC cells. Although regulation of Id‐1 protein by several mitogenic factors is well‐established, little is known about the role of FGF‐2 in the regulation of Id‐1. Using human neuroblastoma cell line, SK‐N‐MC, we found that treatment of these cells with FGF‐2 resulted in early induction of both Id‐1 mRNA and protein. The induction occurs within 1 h from FGF‐2 treatment and is mediated by ERK1/2 pathway, which in turn stimulates expression of the early growth response‐1 (Egr‐1) transcription factor. We also demonstrate direct interaction of Egr‐1 with Id‐1 promoter in vitro and in cell culture. Finally, inhibition of Id‐1 expression results in G₂/M accumulation of FGF‐2‐treated cells and delayed cell death. J. Cell. Physiol. 226: 1763–1770, 2011. © 2010 Wiley‐Liss, Inc.