The Hippo TEAD-transcriptional regulators YAP1 and TAZ are central for cell renewal and cancer growth; however, the specific downstream gene networks involved in their activity are not completely understood. Here we introduce TEADi, a genetically encoded inhibitor of the interaction of YAP1 and TAZ with TEAD, as a tool to characterize the transcriptional networks and biological effects regulated by TEAD transcription factors. Blockage of TEAD activity by TEADi in human keratinocytes and mouse skin leads to reduced proliferation and rapid activation of differentiation programs. Analysis of gene networks affected by TEADi and YAP1/TAZ knockdown identifies KLF4 as a central transcriptional node regulated by YAP1/TAZ-TEAD in keratinocyte differentiation. Moreover, we show that TEAD and KLF4 can regulate the activity of each other, indicating that these factors are part of a transcriptional regulatory loop. Our study establishes TEADi as a resource for studying YAP1/TAZ-TEAD dependent effects.