This study represents a first step in investigating the possible involvement of transforming growth factor-beta (TGF-beta) in the regulation of embryonic chick limb cartilage differentiation. TGF-beta 1 and 2 (1-10 ng/ml) elicit a striking increase in the accumulation of Alcian blue, pH 1-positive cartilage matrix, and a corresponding twofold to threefold increase in the accumulation of 35S-sulfate- or 3H-glucosamine-labeled sulfated glycosaminoglycans (GAG) by high density micromass cultures prepared from the cells of whole stage 23/24 limb buds or the homogeneous population of chondrogenic precursor cells comprising the distal subridge mesenchyme of stage 25 wing buds. Moreover, TGF-beta causes a striking (threefold to sixfold) increase in the steady-state cytoplasmic levels of mRNAs for cartilage-characteristic type II collagen and the core protein of cartilage-specific proteoglycan. Only a brief (2 hr) exposure to TGF-beta at the initiation of culture is sufficient to stimulate chondrogenesis, indicating that the growth factor is acting at an early step in the process. Furthermore, TGF-beta promotes the formation of cartilage matrix and cartilage-specific gene expression in low density subconfluent spot cultures of limb mesenchymal cells, which are situations in which little, or no chondrogenic differentiation normally occurs. These results provide strong incentive for considering and further investigating the role of TGF-beta in the control of limb cartilage differentiation.