Transforming growth factor-beta 1 (TGF-beta 1) is a pleiotropic polypeptide hormone known to play an important role as a modulator of hematopoietic processes in human and murine cells. One of the characteristics of TGF-beta 1 is the ability to inhibit the growth of several cell types, including cells of the myeloid lineage. To study the mechanism by which TGF-beta 1 inhibits the growth of myeloid cells, we have used three murine myeloid cell lines, the parental interleukin-3-dependent 32D-123 cell line and two retrovirally infected interleukin-3-independent cell lines (32D-abl, 32D-src), all of which are growth inhibited by TGF-beta 1. Each of these oncogene-transfected cells expresses a greater number of TGF-beta 1 receptors than the parental cell line and responds to TGF-beta 1 with increased sensitivity; 32D and 32D-src cells are 2- and 58-fold more sensitive to TGF-beta 1 inhibition than the parental cell line (ED50 = 35 pM). Both 32D-abl- and 32D-src-transformed cell lines expressed higher levels of the 65- and 85-kDa TGF-beta 1 receptor species than did the parental cells. We observed a correlation between the greater sensitivity of 32D-src cells to TGF-beta 1 and the more rapid down-modulation and reappearance of cell surface TGF-beta 1 receptors on 32D-src cells. Thus, the level of TGF-beta 1 receptor expression and rate of reexpression both have a crucial regulatory effect on the functional activity of the TGF-beta 1 ligand.