All-trans retinoic acid (atRA), one of the active ingredients of vitamin A, exerts canonical activities to regulate gene expression mediated by nuclear RA receptors (RARs). AtRA could also elicit certain non-canonical activities including, mostly, rapid activation of extracellular signal regulated kinase 1/2 (ERK1/2); but the mechanism was unclear. In this study, we have found that cellular retinoic acid binding protein I (CRABPI) mediates the non-canonical, RAR- and membrane signal-independent activation of ERK1/2 by atRA in various cellular backgrounds. In the context of embryonic stem cells (ESCs), atRA/CRABPI-dependent ERK1/2 activation rapidly affects ESC cell cycle, specifically to expand the G1 phase. This is mediated by ERK stimulation resulting in dephosphorylation of nuclear p27, which elevates nuclear p27 protein levels to block G1 progression to S phase. This is the first study to identify CRABPI as the mediator for non-canonical activation of ERK1/2 by atRA, and demonstrate a new functional role for CRABPI in modulating ESC cell cycle progression.