As previously described, a cell surface-associated adhesive factor (AF) was separated from differentiated rat ascites hepatoma AH136B cells (forming cell islands in vivo) and highly purified by chromatography. AF induces not only aggregation of dissociated AH136B cells or undifferentiated rat ascites hepatoma AH109A cells (present as free cells in vivo), but also adhesiveness characterized by the development of junctional complexes. The localization of AF on the surfaces of AH136B cell islands was investigated using anti-AF IgG (Fab fragment) coupled to peroxidase. AF was detected in the contact region of the lateral surfaces of the AH136B cells and in the intercellular spaces. In contacted free cell surfaces of AH136B cells. Fluorescence studies revealed that biotin-labeled AF did not bind to the apical surface of AH136B cell islands. These results indicate a distinct difference between apical and lateral surfaces of AH136B cells; neither AF nor binding site for AF were localized on the apical surface of AH136B cells, whereas both were localized on the lateral surface. On the other hand, AH136B cells detached from the cell islands, or during the process of partial dissociation from them, showed the loss of the AF localization and binding site of AF on the surfaces. The results suggest that AH136B cell surfaces may be polarized in terms of the AF localization, and this polarization may be lost after cell dissociation.