The retinoids are reported to reduce second primary aerodigestive tract tumors in patients with prior lung or head and neck carcinomas. Yet, the optimal retinoid useful for chemoprevention and those mechanisms linked to this chemoprevention are not identified. This study reports an in vitro model for carcinogen-induced transformation of immortalized human bronchial epithelial (BEAS-2B) cells that was adapted to study the anti-carcinogenic effects of all-trans-retinoic acid (RA). Following exposure to carcinogens: cigarette smoke condensate (CSC) or N-nitrosamine-4-(methylnitrosamino)-1-(3 pyridyl)-1-butanone (NNK), BEAS-2B cells exhibited evidence of transformation. This included an increased anchorage independent growth or acquired ability to form tumors in athymic mice. This transformation was inhibited by RA as demonstrated by a lack of augmented anchorage independent growth or tumor formation in athymic mice for the cells treated with RA. The BEAS-2B cells transformed by NNK exhibited an increase in cyclin E expression which was associated with an increase in the cyclin E-Cdk2 kinase activity. Over-expression of human cyclin E by transfection shows cyclin E enhances the basal clonal growth of BEAS-2B cells. In both the parental and transformed BEAS-2B cells, RA down-regulated cyclin E protein levels which was associated with an inhibition of growth and an accumulation of cells in G1. The data reported here suggest the decline of cyclin E expression represents a potential mechanism for the RA-induced growth suppression which is linked to the anti-carcinogenic effects of RA. Thus, this study reports the adaption of an in vitro model of lung carcinogenesis suitable to test the activity of chemoprevention agents.