Tumor suppressor gene CYLD is a deubiquitinating enzyme which negatively regulates various signaling pathways by removing the lysine 63-linked polyubiquitin chains from several specific substrates. Loss of CYLD in different types of tumors leads to either cell survival or proliferation. In this study we demonstrate that lack of CYLD expression in CYLD-/- MEFs increases proliferation rate of these cells compared to CYLD+/+ in a serum concentration dependent manner without affecting cell survival. The reduced proliferation rate in CYLD+/+ in the presence of serum was due to the binding of serum response factor (SRF) to the serum response element identified in the CYLD promoter for the up-regulation of CYLD levels. The serum regulated recruitment of SRF to the CYLD promoter was dependent on p38 mitogen-activated protein kinase (MAPK) activity. Elimination of SRF by siRNA or inhibition of p38 MAPK reduced the expression level of CYLD and increased cell proliferation. These results show that SRF acts as a positive regulator of CYLD expression, which in turn reduces the mitogenic activation of serum for aberrant proliferation of MEF cells.