Cell differentiation is an essential process for the development of various cell types that constitute multicellular organisms. During development, the large family of factors bearing a helix-loop-helix (HLH) motif participates profoundly in this process and these factors serve as good experimental tools for investigating mechanisms underlying tissue-specific differentiation. The HLH family includes both positive and negative regulators of cell differentiation: basic HLH (bHLH)-type transcription factors and Id proteins, respectively. Following an exciting decade focusing on bHLH factors, advances achieved in studies of the inhibitory factors in the last couple of years have placed them in the front line of the research on differentiation and proliferation control. Here, we present and discuss recent results obtained using Id2 -deficient mice, which manifest intriguing phenotypes in various systems.