Cyclic AMP (cAMP) cooperates with a wide variety of polypeptide growth factors to synergistically stimulate the proliferation of many vertebrate cell types. However, the cellular mechanisms underlying these cooperative interactions are for the most part unknown. We have identified one such mechanism by observing that (i) cultured rat Schwann cells proliferate in response to platelet-derived growth factor (PDGF) only if simultaneously cultured in the presence of agents that elevate intracellular cAMP and (ii) this unmasked PDGF response is accounted for by a dramatic cAMP-mediated induction of PDGF receptor mRNA and protein. cAMP-mediated induction of the PDGF receptor results in enhanced, ligand dependent receptor autophosphorylation, and in enhanced PDGF activation of c-fos gene expression. In addition, this induction is unique to those cells, such as Schwann cells, for which cAMP is itself mitogenic. These results indicate that the synergistic proliferative effect obtained from the combination of cAMP and polypeptide growth factors may in large result from the cAMP-mediated induction of growth factor receptors.