The glucocorticoid and transforming growth factor-alpha (TGF-alpha) regulation of growth and cell-cell contact was investigated in the Con8 mammary epithelial tumor cell line derived from a 7,12-dimethylbenz(alpha)anthracene-induced rat mammary adenocarcinoma. In Con8 cell monolayers cultured on permeable filter supports, the synthetic glucocorticoid, dexamethasone, coordinately suppressed [3H]thymidine incorporation, stimulated monolayer transepithelial electrical resistance (TER), and decreased the paracellular leakage of [3H]inulin or [14C]mannitol across the monolayer. These processes dose dependently correlated with glucocorticoid receptor occupancy and function. Constitutive production of TGF-alpha in transfected cells or exogenous treatment with TGF-alpha prevented the glucocorticoid growth suppression response and disrupted tight junction formation without affecting glucocorticoid responsiveness. Treatment with hydroxyurea or araC demonstrated that de novo DNA synthesis is not a requirement for the growth factor disruption of tight junctions. Immunofluorescence analysis revealed that the ZO-1 tight junction protein is localized exclusively at the cell periphery in dexamethasone-treated cells and that TGF-alpha caused-ZO-1 to relocalize from the cell periphery back to a cytoplasmic compartment. Taken together, our results demonstrate that glucocorticoids can coordinately regulate growth inhibition and cell-cell contact of mammary tumor cells and that TGF-alpha, can override both effects of glucocorticoids. These results have uncovered a novel functional "cross-talk" between glucocorticoids and TGF-alpha which potentially regulates the proliferation and differentiation of mammary epithelial cells.