Rat embryo fibroblasts (REFs) are inefficiently transformed by RAS-oncogenes. Induction of p16INK4A expression by RAS has been suggested to contribute to this resistance. Glucocorti-coid hormones, (DEX), enhance REF transformation by RAS and facilitates the isolation of transformed and immortal cell lines. We show that DEX induced cell proliferation is paralleled by a decrease in Cdkn2a gene transcripts, suggesting a mechanism for hormone promotion. The mechanisms of progression into hormone independent cell lines were examined. Twenty-two of 30 clones which reached a population size of approximately 106cells could be established as cell lines. All lines studied showed homozygous deletions of the Cdkn2 loci (Cdkn2a and Cdkn2b) on RNO5. LOH was found for all RNO5 genetic markers examined in 7 of 19 cell lines, suggesting non-disjunction events. In the remaining 12 cell lines, both copies of Cdkn2 appeared to be lost by deletions/rearrangements, some of which could by demonstrated by karyotype analysis. We conclude that (i) clonal expansion of RAS-transfected REF by DEX is paralleled by down-regulation of Cdkn2a expression; (ii) homozygous deletion of Cdkn2 were estimated to occur at a frequency of 2 × 10−8/cell/generation or higher, and (iii) deletion/rearrangements and non-disjunction appear to be the main mechanisms leading to deletion of Cdkn2.