Interferon-gamma, a known inhibitor of tumor cell growth, has been used in several protocols for the treatment of melanoma. We have studied the molecular events underlying interferon-gamma-induced G0/G1 arrest in four metastatic melanoma cell lines with different responsiveness to interferon-gamma. The growth arrest did not result from enhanced expression of cyclin-dependent kinase inhibitors p21 and p27. Instead, it correlated with downregulation of cyclin E and cyclin A and inhibition of their associated kinase activities. We show that interferon-gamma-induced growth inhibition could be abrogated by overexpression of dominant negative STAT1 (signal transducer and activator of transcription 1) in the melanoma cell line A375, suggesting that STAT1 plays a crucial part for the anti-proliferative effect. Erythropoietin stimulation of a chimeric receptor led to a concentration-dependent STAT1 activation and concomitant growth arrest when it contained the STAT recruitment motif Y440 of the interferon-gamma receptor 1. In contrast, dose-response studies for interferon-gamma revealed a discrepancy between levels of STAT1 activation and the extent of growth inhibition; whereas STAT1 was activated by low doses of interferon-gamma (10 U per mL), growth inhibitory effects were only visible with 100-fold higher concentrations. Our results suggest the presence of additional signals emanating from the interferon-gamma receptor, which may counteract the anti-proliferative function of STAT1.