Megakaryocyte development is a carefully controlled process that is at least partially regulated by cytokines. Previous investigations of megakaryocyte development have focused primarily on defining growth factors that induce or enhance differentiation. In this study we demonstrate that a specific cytokine, transforming growth factor beta 1 (TGF beta 1), inhibits the phorbol myristate acetate (PMA)-induced differentiation of the Dami human megakaryocytic cell line. The addition of purified platelet TGF beta 1 inhibits PMA-induced endomitosis in a dose-dependent manner. Inhibition of endomitosis occurs with as little as 0.4 pmol/L TGF beta 1, is half-maximal at 6.4 pmol/L, and is maximal between 40 and 200 pmol/L TGF beta 1. Inhibition does not require other growth factors or nonmegakaryocytic cells. Removal of TGF beta 1 from the cultures decreases inhibition, suggesting that the continuous presence of TGF beta 1 is required and that its effects are reversible. This effect occurs even though the Dami cells constitutively express TGF beta 1 messenger RNA (mRNA) and the TGF beta 1 mRNA levels are increased by PMA. TGF beta 1 also has been shown to inhibit endomitosis during short-term culture of primary human megakaryocytes. These results suggest a model in which negative as well as positive regulatory factors modulate a critical stage of megakaryocyte development.