Murine myelomonocytic leukemia M1 cells have been used to examine the effects of type-beta 1 transforming growth factor (TGF-beta 1) on cellular proliferation and differentiation in monocyte-macrophage lineage. TGF-beta 1 inhibited immature M1 cell growth due to a general slowdown of the cell cycle, without arrest at any specific point. Ten nanograms per milliliter TGF-beta 1 completely suppressed phagocytic activity and adhesion to the dish surface and partially inhibited the expression of Fc receptors and vimentin during the differentiation of M1 cells induced by IL-6. IL-6-induced declines in the expression of c-myc mRNA and in the accumulation of G0/G1 cells were also partially blocked by TGF-beta 1. When treated concurrently with IL-6 and TGF-beta 1, approximately 50% of M1 cells were morphologically converted to promonocyte or monocyte-like cells, which did not exhibit the characteristics of mature macrophages. Although pretreatment with TGF-beta 1 also inhibited the IL-6-induced phagocytic activity, this inhibition was reversible. Once TGF-beta 1 was removed from the culture medium after 72 h of incubation with IL-6, the kinetics of differentiation induced by IL-6 were faster in pretreated cells than in nonpretreated cells. TGF-beta 1 appears to inhibit the IL-6 induced conversion of M1 cells at the intermediate stage of monocytic differentiation.