Erythropoietin stimulates the immature erythroid J2E cell line to terminally differentiate and maintains the viability of the cells in the absence of serum. In contrast, a mutant J2E clone (J2E-NR) fails to mature in response to erythropoietin; however, it remains viable in the presence of the hormone. We have shown previously that intracellular signalling is disrupted in the J2E-NR cell line and that tyrosine phosphorylation is dramatically reduced after erythropoietin stimulation. In this study we investigated the defect in J2E-NR cells that is responsible for their inability to differentiate. Screening of numerous signalling molecules revealed that the lyn tyrosine kinase appeared to be absent from J2E-NR cells. On closer examination, both lyn mRNA and protein content were reduced >500-fold. Consistent with a defect in lyn, amphotropic retroviral infection of J2E-NR cells with lyn restored the ability of the cells to synthesize haemoglobin and enabled the cells to mature morphologically. Conversely, the ability of J2E cells to differentiate in response to epo was severely curtailed when antisense lyn oligonucleotides or a dominant negative lyn were introduced into the cells. However, erythropoietin-supported viability was unaffected by reducing lyn activity. The ability of two other erythropoietin-responsive cell lines (R11 and R24) to differentiate in response to the hormone was also reduced by dominant negative lyn. Finally, co-immunoprecipitation and yeast two-hybrid analyses indicated that lyn directly associated with the erythropoietin receptor complex. These data indicate for the first time an essential role for lyn in erythropoietin-initiated differentiation of J2E cells but not in the maintenance of cell viability.