Cellular subpopulations having two of the growth properties of neoplastically transformed cells--lack of postconfluence inhibition of cell division (CI-) and anchorage independence of growth (AD-)--were found in cell cultures established from 10- to 13-day-old Syrian hamster embryos. The subpopulations having these properties decrease with increasing gestation period of the embryo as well as with continuing passage in vitro. The decrease in these subpopulations was also observed when they were cultured on a lethally irradiated confluent monolayer of contact-inhibited cells (cell mat), a selection condition for CI- cells. Therefore, negative selection cannot be the explanation for the loss of CI- cells in the population, leaving two other possibilities: either the loss of proliferative capacity of the CI- cells or the acquisition of sensitivity to postconfluence inhibition of cell division (CI+) of this subpopulation on in vitro culture or in vivo growth. The CI- subpopulations were isolated clonally from cell mats and were cultured continuously on both cell mats or plastic dishes. The results indicate that these cells did not lose proliferative capacity but acquired the contact-inhibited phenotype. This result, together with the fact that embryonic development in vivo also decreases CI/AD-subpopulations, suggests that the disappearance of these subpopulations is due to cellular differentiation of the CI-/AD- cells to become CI+/AD+ cells.