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XAF1 (X chromosome-linked inhibitor of apoptosis [XIAP]-associated factor 1) is a novel XIAP modulator that negatively regulates the anti-apoptotic effects of XIAP and sensitizes cells to other cell death triggers. It has been reported to be downregulated in a variety of human cancer cell lines. However, the role of XAF1 in pancreatic carcinogenesis remains unclear. In the present study, we investigated the prognostic values of XAF1 expression and its regulation in cancer cell growth and apoptosis both in vitro and in vivo. From the immunohistochemistry staining of tissue microarray, 40 of 89 (44.9%) pancreatic specimens showed low levels of XAF1 expression. Statistical analysis suggested the downregulation of XAF1 was significantly correlated with tumor staging (P = 0.047) and those patients with low XAF1 levels had shorter survival times (P = 0.0162). Multivariate analysis indicated that XAF1 expression was an independent prognostic indicator of the survival of patients with pancreatic cancer (P = 0.007). Furthermore, we found that restoration of XAF1 expression mediated by Ad5/F35 virus suppressed cell proliferation and induced cell cycle arrest and apoptosis, accompanied by the activation of caspases 3, 8, and 9 and poly(ADP-ribose) polymerase as well as increased level of cytochrome c and Bid cleavage. Notably, XAF1 restoration robustly decreased survivin expression rather than XIAP. In addition, in vivo s.c. xenografts from Ad5/F35-XAF1 treatment, which showed less cellular proliferation and enhanced apoptosis, were significantly smaller than those from control groups. Our findings document that XAF1 is a valuable prognostic marker in pancreatic cancer and could be a potential candidate for cancer gene therapy. (Cancer Sci 2009)