Two different classes of hamster cell mutants (25RA cells and M1 cells) express opposite phenotypes in sterol dependent regulation. In 25RA cells, sterols added in growth medium fail to cause down-regulation of sterol synthesis rate and low density lipoprotein (LDL) receptor activity, while in M1 cells, removal of lipids from growth medium fail to cause up-regulation of sterol synthesis rate and LDL receptor activity. Cell hybridization analysis showed that the 25RA phenotype is semidominant, while the M1 phenotype is recessive. Using 25RA as the parental cells, we isolated eight independent mutant cells (DM cells) and showed that all of them belong to the same genetic complementation group as the M1 mutant, indicating that the normal (unmutated) M1 gene product(s) is required to express the 25RA phenotype. We next performed gene transfer experiments using hamster cell genomic DNAs containing the functional human M1 gene as the donor, and the double mutant cell DM7 as the recipient. The resultant transfectant cells express the 25RA cell phenotype (instead of the wild-type cell phenotype). This result, along with the results obtained from cell hybridization analysis, shows that the 25RA and M1 cell phenotypes are caused by mutations at two different genes.