We have recently found that ras oncogene product (p21) inhibits cysteine proteinases. Because p21 transforms NIH3T3 cells and also induces differentiation of PC12 pheochromocytoma cells, several potent cysteine proteinase inhibitors have been tested for whether they show similar biological activities. The saturation density of NIH3T3 cells was increased by repeated treatment with cysteine proteinase-specific inhibitors such as N-acetyl-leucyl-leucyl-norleucinal (ALLN), N-acetyl-leucyl-leucyl-methioninal (ALLM), E-64 and chicken egg white cystatin. Furthermore, some transformed foci appeared a few weeks after the onset of the treatment. ALLN and ALLM were also able to induce neurite outgrowth of PC12 cells. Taken together, the cysteine proteinase-specific inhibitory activity of p21 may be important for its biological activities.