TGF-beta 1 is demonstrated to inhibit skin keratinocyte proliferation when added during the G1 phase of the cell cycle. Human foreskin keratinocytes transformed with either HPV-16 or -18 or SV40, however, were resistant to the growth inhibitory effects of TGF-beta 1. Since TGF-beta 1 appears to inhibit keratinocyte growth through down-regulation of c-myc, it was hypothesized that these DNA tumor viruses might be modulating the response to TGF-beta 1 via this pathway. Transient expression of proteins HPV-16 E7, adenovirus type 5 E1A, and SV40 large T antigen is demonstrated to block TGF-beta 1 suppression of c-myc transcription. This effect was not observed with DNA tumor virus transforming proteins mutated in their pRB binding domain. These observations indicate that pRB or another protein that interacts with this binding domain mediates TGF-beta 1 regulation of c-myc gene expression and growth inhibition.