Mutation of the p53 tumor suppressor gene is the most common genetic alteration in human cancer. A majority of these mutations are missense mutations in the DNA-binding domain. As a result, the mutated p53 gene encodes a full-length protein incapable of transactivating its target genes. In addition to this loss of function, mutant p53 can have a dominant negative effect over wild-type p53 and/or gain of function activity independently of the wild-type protein. To better understand the nature of the tumorigenic activity of mutant p53, we have investigated the mechanism by which mutant p53 can exert a dominant negative effect. We have established several stable cell lines capable of inducibly expressing a p53 mutant alone, wild-type p53 alone, or both proteins concurrently. In this context, we have used chromatin immunoprecipitation to determine the ability of wild-type p53 to bind to its endogenous target genes in the presence of various p53 mutants. We have found that p53 missense mutants markedly reduce the binding of wild-type p53 to the p53 responsive element in the target genes of p21, MDM2, and PIG3. These findings correlate with the reduced ability of wild-type p53 in inducing these and other endogenous target genes and growth suppression in the presence of mutant p53. We also showed that mutant p53 suppresses the ability of wild-type p53 in inducing cell cycle arrest. This highlights the sensitivity and utility of the dual inducible expression system because in previous studies, p53-mediated cell cycle arrest is not affected by transiently overexpressed p53 mutants. Together, our data showed that mutant p53 exerts its dominant negative activity by abrogating the DNA binding, and subsequently the growth suppression, functions of wild-type p53.