The monomyelocytic leukemia WEHI-3B D+ can be induced to differentiate into mature granulocytes in suspension culture when exposed to 40 nM adriamycin. Treated cells underwent approximately two divisions prior to reaching plateau phase, with approximately 55% of the cell population expressing nitro blue tetrazolium positivity (NBT+) by day 3. Decreased cellular proliferation was paralleled by a progressive increase in morphologically mature granulocytic cells. Maturation was also characterized by a 4.4-fold increase in Fc receptors on the cell surface. An increase in the size of adriamycin-treated cells occurred and correlated with residency in the G2M phase of the cell cycle. Adriamycin-induced NBT+ cells, which contained the highest levels of Fc receptors, were also found to reside in G2M. Adriamycin blocked cells in the G2M phase of the cell cycle by 8 hr (125% above control), and this arrest reached its maximum by 20 hr (194% above control). Concomitant with the block in the cell cycle was the commitment by these cells within 8 hr to the granulocytic pathway of differentiation. Fractionation of cells by centrifugal elutriation into enriched phases of the cell cycle was consistent with the hypothesis that induction of the differentiation program was initiated either in G1 or very late in the cell cycle. Immobilized adriamycin, which does not gain access to the cell interior, did not induce the maturation of WEHI-3B D+ cells, nor did it block their replication in a specific phase of the cell cycle; however, immobilized adriamycin was 30-fold more toxic to WEHI-3B D+ cells than free drug. Incubation of WEHI-3B D+ cells with the semisynthetic adriamycin analog N-trifluoroacetyl adriamycin-14-valerate (AD-32) resulted in approximately 50% of the cell population being NBT+ by day 3. The findings suggest that adriamycin must be able to enter cells to induce maturation, and that at least some portion of its toxicity is associated with an effect at the surface membrane. Furthermore, the results obtained with AD-32 imply that intercalation into DNA is not necessary for induction of the differentiated phenotype.