Skeletal muscle development is regulated by a complex series of genetic and environmental cues that control the establishment of the myogenic lineage and the differentiation of determined myoblasts. Numerous agents, including growth factors and oncogene products, have been shown to inhibit skeletal muscle development, possibly by affecting the pattern of signal transduction that is required for myogenesis. Among the eukaryotic G proteins that have been implicated as mediators of signal transduction are the protein products of the mammalian ras genes (p21s). In this study, we demonstrate that expression of a transfected, oncogenic, human H-ras gene in C3H10T1/2-derived myoblasts has dramatic, yet varied, effects on skeletal myogenesis. While some H-ras transformed myoblast clones are differentiation-defective, other clones are inhibited from morphologically differentiating but retain a limited ability to biochemically differentiate. The H-ras induced inhibition of differentiation usually is associated with a decreased expression of the myogenic determination gene, MyoD1. Introduction of a MyoD1 cDNA expression vector into differentiation-defective H-ras expressing myoblasts partially restores the myogenic potential in these cells. Our results suggest that activated H-ras p21 inhibits the terminal differentiation of myoblasts by producing a general reduction in the differentiation competence of cells which, in the most extreme case, is a consequence of the down-regulation of the MyoD1 determination gene.