We have investigated whether the activation of endogenous ras genes is associated with the immortalization or malignant transformation of primary hamster epidermal cells by chemical carcinogens. We have also asked whether transfection of a cloned c-Ha-ras oncogene (pEJ) into a nontumorigenic cell line established from hamster epidermal cells by N-methyl-N'-nitro-N-nitrosoguanidine treatment can induce conversion to a malignant phenotype. DNA from the nontumorigenic epidermal cell line (H5-MNNG) and from two neoplastic cell lines transformed by benzo(a)pyrene was not capable of transforming NIH/3T3 cells. This result suggests that these cells do not contain an activated (mutated) ras gene. However, when H5-MNNG cells were cotransfected with pEJ and pSV2-gpt, a plasmid containing the dominant selectable marker gene Ecogpt, seven of nine clones of Ecogpt transformants formed carcinomas in nude mice and colonies in soft agar. Southern blot analysis of BamHl-digested genomic DNA from the Ecogpt-transformed clones indicated that rapid malignant transformation was associated with integration of a complete copy of the 6.6-kilobase fragment of pEJ containing the activated c-Ha-ras gene. Furthermore, DNA from the malignant clones transformed NIH/3T3 cells in a secondary transfection assay. These studies demonstrate that a mutated c-Ha-ras gene, under the transcriptional control of its normal cellular promoter, can rapidly transform a nontumorigenic epidermal cell line. This result suggests that activation of an endogenous c-ras gene can function as the final completing event in the progression of epithelial cells to the malignant phenotype. Thus, preneoplastic cell lines of both mesenchymal and epithelial origin have now been shown to be susceptible to malignant conversion by a single mutation in a c-Ha-ras proto-oncogene.