Transforming growth factor-alpha (TGF alpha) can stimulate keratinocyte proliferation and function as an autocrine tumor promoter in 7,12-dimethylbenz[a]anthracene (DMBA)-initiated TGF alpha-transgenic mouse skin. In this study, we examined the effect of ectopic TGF alpha transgene expression on skin tumor growth and progression after DMBA initiation in the presence of 12-O-tetradecanoylphorbol-13-acetate (TPA). Both the multiplicity and size of skin tumors arising in TGF alpha-transgenic mice were significantly higher than those of the nontransgenic parental CD-1 strain. There were more dysplastic papillomas and squamous cell carcinomas (SCCs) in the transgenic animals as well. ProTGF alpha protein was expressed in transgenic papillomas, but mature TGF alpha was not detected. The epidermal growth factor receptor (EGFR) appeared to be downregulated and was associated with enhanced tyrosine phosphorylation of several substrates in TGF alpha-transgenic mouse tumors. Characteristic codon 61 mutations in the Ha-ras gene were found in most of the papillomas and SCCs induced by DMBA and TPA in transgenic as well as nontransgenic mice. However, no p53 gene mutations were found in any skin tumors from either transgenic or control animals. Analysis of cellular proliferation in both DMBA-TPA-induced papillomas and in skin 48 h after TPA treatment alone revealed significantly more DNA synthesis in TGF alpha-transgenic mice relative to controls. These results demonstrate that TGF alpha, through EGFR overstimulation, can act synergistically with TPA to induce the formation, growth, and development of DMBA-initiated skin tumors containing classic Ha-ras gene mutations but not p53 gene inactivation.