Mouse epidermal cells have frequently been used to study the role of ras oncogenes in transformation in vivo and in vitro. After initiation with dimethylbenzanthracene (DMBA) in vivo, greater than 90% of the papillomas arising show the same A:T----T:A transversion at codon 61 of the H-ras gene, presumed to be the initiating event. On the other hand, initiation of epidermal cells in culture with carcinogens, followed by selection of initiated cells by resistance to calcium-induced differentiation, does not in general lead to the isolation of clones carrying mutant ras genes. Some other aspects of tumour progression in vivo can be reproduced using epidermal cells in culture: a rare DMBA transformant carrying the codon 61 mutation and expressing a 2:1 ratio of normal to mutant ras alleles gave rise upon transplantation to a more aggressive line in which the ratio of normal to mutant H-ras genes (and p21 products) was reversed. Similar alterations in ras gene dosage have been seen during progression of papillomas to carcinomas in vivo. We conclude that the mechanisms of initiation in vitro may differ substantially from in vivo, and depend on the particular culture conditions used. Moreover, the effects of mutant H-ras expression in mouse epidermal cells are variable depending on the genetic background of the cell.