In the studies reported here, we demonstrate that transforming growth factor alpha (TGF-alpha) or epidermal growth factor (EGF) is required for the establishment of small colonies of human keratinocytes at clonal densities, but once small (10-15 cells) colonies have formed, the continued growth of these colonies can proceed in the absence of exogenous TGF-alpha or EGF. Equivalent receptor-binding concentrations of TGF-alpha and EGF were equipotent in stimulating colony formation. We also demonstrate that the growth of keratinocytes at high densities proceeds in the absence of exogenous peptide growth factors or hormones. The expression of TGF-alpha mRNA and protein is regulated by both cell density and the presence of exogenous growth factors. The addition of an antibody which blocks the mitogenic effect of mature TGF-alpha had no effect on the autocrine/paracrine growth of these cells at either density. However, monoclonal antibodies which antagonize ligand activation of the EGF receptor inhibit the autonomous proliferation of keratinocytes at high density and abrogate the exogenous TGF-alpha/EGF-independent expansion of colonies at clonal density. The results of these experiments are among the first evidence to demonstrate that normal human epithelial cells in culture exhibit autocrine/paracrine-mediated proliferation. Exogenous growth factors initiate colonies of human keratinocytes that become self-perpetuating in culture. Keratinocytes regulate production of the mitogenic ligand, TGF-alpha, through a density-dependent mechanism, and cell density stringently controls proliferation.