One critical factor in melanoma progression is the change from radial growth phase to vertical growth phase. We previously showed a high incidence of ras mutations in progressing but not early human melanomas. We also found that stable expression of activated Ras in a primary human melanoma cell line (WM35) led to enhanced proliferation, anchorage-independent survival, migration and invasion in vitro and enhanced subcutaneous tumor formation in vivo, transforming the melanoma phenotype from the radial growth phase to the vertical growth phase. Inhibitory cytokines, especially transforming growth factor-beta, are important in homeostasis of normal human melanocytes. Proliferation of early melanoma cells can be inhibited by transforming growth factor-beta, whereas more aggressive stages lose this response. Using a transforming growth factor-beta activated luciferase reporter transiently transfected into WM35, WM35N-ras, and WM35H-ras (WM35 transfected with mutant N-ras or H-ras genes), we demonstrated significant decreases (p < 0. 04) in transforming growth factor-beta induced reporter expression in both ras transfected cell lines. Transforming growth factor-beta also induced significant decreases (p < 0.002) in the proportion of WM35 cells in S-phase of the cell cycle; this effect was not observed in WM35N-ras cells. Furthermore, we demonstrated that an important controlling factor in transforming growth factor-beta inhibition of cell cycle progression, the phosphorylation of the Rb protein, was altered in WM35N-ras; transforming growth factor-beta caused a marked relative increase in hypophosphorylated pRb in WM35 cells, but not in WM35N-ras. These data suggest that activated Ras plays an important part in melanoma progression from the radial growth phase to the vertical growth phase by counteracting inhibition by cytokines such as transforming growth factor-beta, thus providing a growth advantage.