In a previous study we demonstrated that many hematopoietic tumor cells are resistant to the inhibitory effects that interferon exerts on c-myc mRNA expression without losing other receptor-mediated intracellular responses (M. Einat, D. Resnitzky, and A. Kimchi, Nature [London] 313:597400). We report here that this partial resistance was overridden in two independent stable somatic cell hybrids prepared by fusion between sensitive and resistant cells. The c-myc mRNA transcribed from the active allele of the resistant parent cell was reduced by interferon within the context of the cell hybrid. It was therefore concluded that changes in the cis-acting sequences of c-myc were not involved in this type of relaxed regulation and that resistance resulted rather from inactivation or loss of postreceptor elements which operate in trans. The growth-stimulating effect that this genetic deregulation might have on cells was tested in experimental systems of cell differentiation in which an autocrine interferon is produced. For that purpose we isolated variant clones of Ml myeloid cells which were partially resistant to alpha and beta interferons and tested their growth behavior during in vitro-induced differentiation. The resistant clones displayed higher proliferative activity on days 2 and 3 of differentiation than did the sensitive clones, which stopped proliferating. The loss of c-myc responses to the self-produced interferon disrupted the normal cessation of growth during differentiation and therefore might lead cells along the pathway of neoplasia.