Methylation of the p16 (INK4a) tumor suppressor gene is observed frequently in multiple myeloma and various forms of lymphoma and mediates silencing of p16 gene expression. In this investigation, we have determined the effect of the DNA demethylating drug decitabine (DAC; 5-aza-2'-deoxycytidine) on the growth, cell cycle kinetics, RB phosphorylation, and expression of p16 (INK4a) and p21(WAF1) in EBV- human myeloma and EBV+ lymphoblastic cell lines possessing silenced, methylated p16 (INK4a) genes to: (1). evaluate its potential as a therapeutic agent and (2). investigate its mechanism of action. Demethylation of the p16 (INK4a) gene and expression of the p16 (INK4a) protein were observed using higher doses (10(-6)-10(-7)M) of drug while growth inhibition at lower doses (IC(50)=2 x 10(-8)-4 x 10(-8)M) was associated with RB dephosphorylation and increased expression of p21 (WAF1), but not with induction of p16 (INK4a), or apoptosis. Kinetic experiments demonstrated that RB dephosphorylation and the increase of p21 (WAF1) preceded the induction of p16 (INK4a). The drug induced cell cycle arrest at the G1 and G2/M phases. Antisense experiments demonstrated that the G1 arrest was mediated by transcriptional induction of p21(WAF1). In addition to these observed effects on cell cycle regulatory proteins, decitabine also increased phosphorylation of p38 MAP kinase. The G2/M arrest was inhibited by the p38 MAP kinase inhibitor SB203580, indicating that activation of p38 MAP kinase pathway was required for G2/M arrest. Thus, decitabine inhibited growth by inducing cell cycle arrest at the G1 phase mediated by p21(WAF1) and the G2/M phase through activation of the p38 MAP kinase pathway.