Peroxisome proliferators are a structurally diverse group of non-genotoxic chemicals that induce predictable pleiotropic responses including the development of liver tumors in rats and mice. These chemicals interact variably with peroxisome proliferator-activated receptors (PPARs), which are members of the nuclear receptor superfamily. Evidence derived from mice with PPARalpha gene disruption indicates that of the three PPAR isoforms (alpha, beta/delta and gamma), the isoform PPARalpha is essential for the pleiotropic responses induced by peroxisome proliferators. Peroxisome proliferator-induced activation of PPARalpha leads to profound transcriptional activation of genes encoding for the classical peroxisomal beta-oxidation system and cytochrome P450 CYP 4A isoforms, CYP4A1 and CYP4A3, among others. Livers with peroxisome proliferation manifest substantial increases in the expression of H(2)O(2)-generating peroxisomal fatty acyl-CoA oxidase, the first enzyme of the classical peroxisomal fatty acid beta-oxidation system, and of microsomal cytochrome P450 4A1 and 4A3 genes. Disproportionate increases in H(2)O(2)-generating enzymes and H(2)O(2)-degrading enzyme catalase and reductions in glutathione peroxidase activity by peroxisome proliferators, lead to increased oxidative stress in liver cells. Sustained oxidative stress resulting from chronic increases in H(2)O(2)-generating enzymes manifests as massive accumulation of lipofuscin in hepatocytes, and increased levels of 8-hydroxydeoxyguanosine adducts in liver DNA; this supports the hypothesis that oxidative stress plays a critical role in the development of liver tumors induced by these non-genotoxic chemical carcinogens. Evidence also indicates that cells stably overexpressing H(2)O(2)-generating fatty acyl-CoA oxidase or urate oxidase, when exposed to appropriate substrate(s), reveal features of neoplastic conversion including growth in soft agar and formation of tumors in nude mice. Mice with disrupted fatty acyl-CoA oxidase gene (AOX(-/-) mice), which encodes the first enzyme of the PPARalpha regulated peroxisomal beta-oxidation system, exhibit profound spontaneous peroxisome proliferation, including development of liver tumors, indicative of sustained activation of PPARalpha by the unmetabolized substrates of acyl-CoA oxidase. With the exception of fatty acyl-CoA oxidase, all PPARalpha responsive genes including CYP4A1 and CYP4A3 are up-regulated in the livers of these AOX(-/-) mice. Thus, the substrates of acyl-CoA oxidase serve as endogenous ligands for this receptor leading to a receptor-enzyme cross-talk, because acyl-CoA oxidase gene is transcriptionally regulated by PPARalpha. Peroxisome proliferators induce only a transient increase in liver cell proliferation and this may serve as an additional contributory factor, rather than play a primary role in liver tumor development. Thus, sustained activation of PPARalpha by either synthetic or natural ligands leads to reproducible pleiotropic responses culminating in the development of liver tumors. This phenomenon of peroxisome proliferation provides fascinating challenges in exploring the molecular mechanisms of cell specific transcription, and in identifying the PPARalpha responsive target genes, as well as events involved in their regulation. Genetically altered animals and cell lines should enable investigations on the role of H(2)O(2)-producing enzymes in neoplastic conversion.