Rat pheochromocytoma PC12 cells undergo neuronal differentiation in response to nerve growth factor (NGF). The differentiation involves protein kinase cascades that include the kinases MEK and ERK, as well as activation of the transcription factors c-Jun and c-Fos. We show here, that exposure of PC12 cells to mannosylerythritol lipid (MEL), a yeast extracellular glycolipid, enhances the activity of acetylcholinesterase and interrupts the cell cycle at the G1 phase, with resulting outgrowth of neurites and partial cellular differentiation. Treatment with MEL stimulates the phosphorylation of ERK to a similar extent as treatment with NGF, although, the appearance of phosphorylated ERK is somewhat delayed. Both the MEL-induced outgrowth of neurites and the increase in the activity of acetylcholinesterase are prevented by PD98059, a specific inhibitor of MEK. Northern blotting analysis of c-jun transcripts and analysis of transcription in PC12 cells of a c-jun/CAT reporter construct demonstrated a significant increase in the rate of transcription of the c-jun gene upon treatment with MEL. The sequence elements required for the MEL-mediated activation of transcription of the c-jun gene are located between nucleotides -126 and -79 in the 5' flanking region. Our results suggest that MEL induces characteristics of neuronal differentiation in PC12 cells, with transactivation of the c-jun gene, via an ERK-related signal cascade that is partially overlapping the pathways activated in response to NGF. These results might provide the groundwork for the use of microbial extracellular glycolipids as novel reagents for the treatment of cancer cells.