Previous studies have shown that high levels of c-myc inhibit cell differentiation. The goal of this study was to define the activities and properties of c-myc that are necessary and/or sufficient for this effect. A series of mutant human c-myc genes were stably transfected into the 3T3-L1 preadipocyte cell line and assayed for their capacity to block differentiation into adipocytes. Results of the differentiation tests were then correlated with other known activities and properties of the mutants. Our studies show that the ability of c-myc to inhibit 3T3-L1 cell differentiation requires its transforming activity, and the ability of c-myc to bind sequence-nonspecific DNA and to form oligomers is not sufficient for this effect. Thus, the ability of c-myc to inhibit cell differentiation may be central to its role as a transforming oncogene.