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GM Cep in the young (~ 4 Myr) open cluster Trumpler 37 has been known to be an abrupt variable and to have a circumstellar disk with very active accretion. Our monitoring observations in 2009–2011 revealed the star to show sporadic ?are events, each with brightening of . 0.5 mag lasting for days. These brightening events, associated with a color change toward the blue, should originate from an increased accretion activity. Moreover, the star also underwent a brightness drop of ~ 1 mag lasting for about a month, during which the star became bluer when fainter. Such brightness drops seem to have a recurrence time scale of a year, as evidenced in our data and the photometric behavior of GM Cep over a century. Between consecutive drops, the star brightened gradually by about 1 mag and became blue at peak luminosity. We propose that the drop is caused by obscuration of the central star by an orbiting dust concentration. The UX Orionis type of activity in GM Cep therefore exemplifies the disk inhomogeneity process in transition between grain coagulation and planetesimal formation in a young circumstellar disk.