Expression of the c-myc and c-Ha-ras protooncogenes is dramatically increased in regenerating rat liver as an early response to partial hepatectomy. Nuclear runon transcription studies confirm that the increased c-myc and c-Ha-ras mRNA levels in regenerating livers reflect transcriptional activation of these genes. Mithramycin, a G-C specific DNA binding drug, prevents the increased transcriptional activity of c-myc and c-Ha-ras genes after hepatectomy but does not alter the transcriptional activity of the beta-actin gene. Continuous exposure of rats to mithramycin after hepatectomy prevents the increase in both c-myc and c-Ha-ras expression and blocks the increased cellular proliferation characteristic of regeneration. The delayed increase in c-myc and c-Ha-ras gene expression is associated with a delay in cellular proliferation. The inhibition of c-myc and c-Ha-ras transcription by mithramycin, the delay in cellular proliferation, and the ability of mithramycin to prevent protein binding to the c-myc promoter, suggest that the increased expression of these genes is a necessary component of liver regeneration.