Hypoxia may influence tumor biology in paradoxically opposing ways: it is lethal as a direct stress trigger, yet hypoxic zones in solid tumors harbor viable cells which are particularly resistant to treatment and contribute importantly to disease relapse. To examine mechanisms underlying growth-survival decisions during hypoxia, we have compared genetically related transformed and untransformed fibroblast cells in vitro for proliferation, survival, clonogenicity, cell cycle, and p53 expression. Hypoxia induces G0/G1 arrest in primary fibroblasts but triggers apoptosis in oncogene-transformed derivatives. Unexpectedly, the mechanism of apoptosis is seen to require accumulated acidosis and is rescued by enhanced buffering. The direct effect of hypoxia under nonacidotic conditions is unique to transformed cells in that they override the hypoxic G0/G1 arrest of primary cells. Moreover, when uncoupled from acidosis, hypoxia enhances tumor cell viability and clonogenicity relative to normoxia. p53 is correspondingly upregulated in response to hypoxia-induced acidosis but downregulated during hypoxia without acidosis. Hypoxia may thus produce both treatment resistance and a growth advantage. Given strong evidence that hypoxic regions in solid tumors are often nonacidotic (G. Helmlinger, F. Yuan, M. Dellian, and R. K. Jain, Nat. Med. 3:177-182, 1997), this behavior may influence relapse and implicates such cells as potentially important therapeutic targets.