The cholesterol lowering drug lovastatin, a competitive inhibitor of 3-hydroxy-3-methylglutaryl coenzyme A (HMG-CoA) reductase, blocks DNA synthesis and proliferation of thyrotropin (TSH) primed FRTL-5 rat thyroid cells. The blockade can be completely prevented and/or reversed by mevalonate and largely prevented and/or reversed by farnesol whereas cholesterol and/or other non-sterol mevalonate derivatives such as ubiquinone, dolichol or isopentenyladenosine are ineffective. TSH-dependent augmentation of cyclic-AMP and cAMP dependent differentiated functions, such as iodide uptake, are unaffected by lovastatin. 3H-Thymidine incorporation into DNA is also decreased by alpha-hydroxyfarnesyl-phosphonic acid, an inhibitor of protein farnesylation which mimicks the effect of lovastatin since it also leaves unaffected TSH stimulated iodide uptake. It is suggested that the HMG-CoA reductase inhibitor lovastatin affects cell proliferation mainly through inhibition of protein farnesylation which results in altered function proteins relevant for proliferation control, notably p21ras and/or other small GTPases.