Rat liver perisinusoidal lipocytes (PL) cultured on uncoated plastic transform spontaneously within 6-10 d to myofibroblastlike cells (MFBlC). Parallel to the transformation the TGF alpha- and TGF beta 1-mRNA expression increased and was highest in MFBlC. Competitive radioligand binding assays demonstrated that in contrast to untransformed PL the MFBlC synthesize and secrete transforming growth factor (TGF)-alpha (15 fmol/cell per 24 h) and predominantly the latent form of TGF beta 1 (0.2 fmol/cell per 24 h). Medium conditioned by MFBlC (MFBcM) significantly stimulated PL proliferation with little effect on PL proteoglycan synthesis. By transient acidification of the MFBcM, known to activate the latent form of TGF beta 1, the stimulatory effect on PL proteoglycan synthesis was enhanced and furthermore PL transformation (measured by expression of iso-alpha smooth muscle actin and loss of retinylpalmitate) was accelerated. Preincubation of this medium with neutralizing antibodies to TGF beta resulted in (a) the growth inhibitory effect was converted to a growth stimulation and (b) the stimulatory effect on proteoglycan synthesis was abolished. In summary our data indicate that progressive activation of PL on plastic (transformation to MFBlC) leads to an enhanced expression of the TGF alpha- and TGF beta 1-mRNAs and secretion of the corresponding proteins. Medium conditioned by MFBIC stimulates proliferation, transformation, and PG synthesis of untransformed PL. These mechanisms are suggested to be relevant in self perpetuation of liver fibrogenesis.