Transcription factor. Determines the fate of epidermal cell differentiation. Represses trichome development by lateral inhibition. Together with GL3 or BHLH2, promotes the formation of hair developing cells (H position) in root epidermis, probably by inhibiting non-hair cell formation. Represses the expression of GL2 and WER in H cells. Positively regulates stomatal formation in the hypocotyl (PubMed:19513241). Interacts with GL3 and BHLH2. Interacts with SIEL (PubMed:21924907). Moves from developing non-hair cells (atrichoblasts) to developing hair cells (trichoblasts). Expressed in trichomes and in young developing leaves, as well as in root hair and stele cells (pericycle and vascular tissues). Expressed in epidermal root hairless cells (atrichoblasts) and moves to root hair cells (trichoblasts) by a cell-to-cell movement through plasmodesmata (at protein level). Expressed in leaves primordia and later confined to trichomes. Transcriptional repression correlates with reduced histone acetylation on H3 and H4 mediated by HDA18 in root epidermis N cells (non-hair developing cells). Induced by WER. Negative autoregulation by interfering with the binding of WER to its WER-binding sites (WBS) promoter region, especially in H cells. Down-regulated by GEM. Down-regulated by TMM (PubMed:19513241).