Background The HMGA2 gene, coding for an architectural transcription factor involved in mesenchymal embryogenesis, is frequently deranged by translocation and/or amplification in mesenchymal tumours, generally leading to over-expression of shortened transcripts and a truncated protein. Methods To identify pathways that are affected by sarcoma-associated variants of HMGA2, we have over-expressed wild type and truncated HMGA2 protein in an immortalized mesenchymal stem-like cell (MSC) line, and investigated the localisation of these proteins and their effects on differentiation and gene expression patterns. Results Over-expression of both transgenes blocked adipogenic differentiation of these cells, and microarray analysis revealed clear changes in gene expression patterns, more pronounced for the truncated protein. Most of the genes that showed altered expression in the HMGA2-overexpressing cells fell into the group of NF-κB-target genes, suggesting a central role for HMGA2 in this pathway. Of particular interest was the pronounced up-regulation of SSX1, already implicated in mesenchymal oncogenesis and stem cell functions, only in cells expressing the truncated protein. Furthermore, over-expression of both HMGA2 forms was associated with a strong repression of the epithelial marker CD24, consistent with the reported low level of CD24 in cancer stem cells. Conclusions We conclude that the c-terminal part of HMGA2 has important functions at least in mesenchymal cells, and the changes in gene expression resulting from overexpressing a protein lacking this domain may add to the malignant potential of sarcomas.