Head morphogenesis requires complex signal relays to enable precisely coordinated proliferation, migration, and patterning. Here, we demonstrate that, during mouse head formation, taspase1-mediated (TASP1-mediated) cleavage of the general transcription factor TFIIA ensures proper coordination of rapid cell proliferation and morphogenesis by maintaining limited transcription of the negative cell cycle regulators p16Ink4a and p19Arf from the Cdkn2a locus. In mice, loss of TASP1 function led to catastrophic craniofacial malformations that were associated with inadequate cell proliferation. Compound deficiency of Cdkn2a, especially p16Ink4a deficiency, markedly reduced the craniofacial anomalies of TASP1-deficent mice. Furthermore, evaluation of mice expressing noncleavable TASP1 targets revealed that TFIIA is the principal TASP1 substrate that orchestrates craniofacial morphogenesis. ChIP analyses determined that noncleaved TFIIA accumulates at the p16Ink4a and p19Arf promoters to drive transcription of these negative regulators. In summary, our study elucidates a regulatory circuit comprising proteolysis, transcription, and proliferation that is pivotal for construction of the mammalian head.