Auxin autonomous growth of most crown gall tumor cells requires the expression of two auxin biosynthesizing genes (tms 1 and tms 2) from the T-DNA of Agrobacterium tumefaciens. The potential role of the tms 2 locus to affect auxin accumulation was studied by measuring the activity of its gene product, indoleacetamide hydrolase (AH), in cloned cells of tobacco (Nicotiana tabacum) transformed by the A6 strain of Agrobacterium tumefaciens. AH activity followed a consistent pattern over a 30 day culture cycle with a peak at 10 to 14 days. This same pattern was observed in a number of independently isolated clones as well as in uncioned tumor tissue, suggesting that AH activation is a regular process in wounded, transformed cells. Transfer of unwounded tissue to fresh media resulted in a similar pattern of AH activation, but with the peak activity only about 50 percent of the cut tissues. These results show that the tms 2 encoded AH activity is modulated over the culture cycle, and that the modulation is affected by wounding and supplying fresh nutrients in the medium. AH activity correlated closely with free indoleacetic acid levels which suggests that it can be an important determinant in controlling free IAA levels in transformed cells.