The oncogenic potential of human papillomavirus type 18 which is found in a significant number of cervical and penile cancer biopsies was tested in primary human keratinocytes derived from neonatal foreskin. Viral DNA and a gene for resistance to neomycin were introduced into these cells by calcium phosphate transfection. Selection of cells in G418 led to the isolation of resistant colonies which were propagated in culture. Four cell lines termed FE-A, FEH 18L, FEP18-5, and FEP18-11 have been maintained in culture for 1 1/2-2 years and were selected for further analysis. In all cases the viral DNA was integrated into the cellular genome and the early genes were transcribed, including RNA complementary to the E2, E6, and E7 open reading frames. Radioimmunoprecipitation showed that all cell lines synthesized the E6 and E7 proteins. However, none of the cell lines tested were tumorigenic. The differentiation capacity of these cells was analyzed by assessing their ability to proliferate clonally after exposure to 1.2 mM calcium chloride. All four cell lines were resistant to this stimulus and formed colonies upon return to regular growth medium whereas normal cells differentiated terminally. K6a and K14 keratin RNA expression was down-regulated in the HPV immortalized cell lines compared to primary human epithelial cells.