Granulocyte colony-stimulating factor (G-CSF) stimulates proliferation and differentiation of the progenitor cells of neutrophilic granulocytes. The binding of G-CSF to its receptor specifically activates JAK1 and JAK2 kinases, as well as STAT3, a signal transducer and activator of transcription (STAT). To examine the role of STAT3 in G-CSF receptor-mediated signal transduction, two different forms of the dominant negative STAT3 were introduced into a mouse myeloid cell line that exogenously expresses the mouse G-CSF receptor. In response to G-CSF, the parental myeloid cells grew for about 4 days, and then they stopped dividing and differentiated into cells with lobulated nuclei. During this period, the expression of the myeloperoxidase (MPO) gene was induced, while c-myc gene expression was down-regulated. In contrast, in the cells expressing the dominant negative STAT3, G-CSF could induce neither growth arrest nor morphological change. However, the induction of the MPO gene by G-CSF was not affected by the dominant negative STAT3. These results indicate that STAT3 activation is responsible for part of the G-CSF-induced differentiation of neutrophils but that another pathway, involving the expression of the MPO gene, that does not utilize the activated STAT3, is also required to fully differentiate the cells.