Mice with mutations in both alleles of the Mgmt and the Mlh1 gene, the former encoding a DNA repair methyltransferase and the latter a protein functioning at an early step of mismatch repair, are as resistant to the killing action of alkylating agents as are wild-type mice. These mice yielded a large number of tumors when exposed to alkylating carcinogens, but this characteristic was subdued since they also showed a relatively high level of spontaneous tumorigenicity, as a consequence of the defect in mismatch repair. This complexity is now resolved by introducing the Mlh1(+/-) mutation, instead of Mlh1(-/-), in these methyltransferase-deficient mice. Mgmt(-/-) Mlh1(+/-) mice, with about half the amount of MLH1 protein as Mgmt(-/-) Mlh1(+/+) mice, were resistant to the killing action of N-methyl-N-nitrosourea (MNU), up to the level of 30 mg/kg body wt. Eight weeks after exposure to this dose of MNU, 40% of MNU-treated Mgmt(-/-) Mlh1(+/-) mice had thymic lymphomas and there were no tumors in those mice not given the treatment. It seems that the cellular content of MLH1 protein is a critical factor for determining if damaged cells enter into either one of the two pathways leading to mutation induction or to apototic cell death. Loss of Mlh1 expression was frequently observed in tumors of Mgmt(-/-) Mlh1(+/-) mice and this might be related to progression of the tumors.