Type beta transforming growth factor (TGF-beta) is a two-chain polypeptide of 25,000 daltons isolated from many tissues, including bovine kidney, human placenta, and human platelets. It has been characterized by its ability to stimulate reversible transformation of nonneoplastic murine fibroblasts, as measured by the formation of colonies of these cells in soft agar (ED50 = 4 pM TGF-beta for NRK fibroblasts). We now show that the response of cells to TGF-beta is bifunctional, in that TGF-beta inhibits the anchorage-dependent growth of NRK fibroblasts and of human tumor cells by increasing cell cycle time. Moreover, the anchorage-independent growth of many human melanoma, lung carcinoma, and breast carcinoma cell lines is inhibited by TGF-beta at concentrations in the same range as those that stimulate colony formation of NRK fibroblasts (average ED50 = 10-30 pM TGF-beta for inhibition). Whereas epidermal growth factor and TGF-beta synergize to induce anchorage-independent growth of NRK fibroblasts, their effects on the growth of A-549 human lung carcinoma cells are antagonistic. The bifunctional response of cells to TGF-beta is further demonstrated in Fischer rat 3T3 fibroblasts transfected with a cellular myc gene. In these cells TGF-beta synergizes with platelet-derived growth factor to stimulate colony formation but inhibits the colony formation induced by epidermal growth factor. The data indicate that the effects of TGF-beta on cells are not a function of the peptide itself, but rather of the total set of growth factors and their receptors that is operant in the cell at a given time.