Cultured murine neuroblastoma cells (NB4 line) were treated with the cyclic AMP-elevating agents prostaglandin E1 and papaverine to determine the effect of these agents on the state of differentiation and malignancy of the cells. Morphologic differentiation, determined by the appearance of neurite extensions greater than 50µ, occurred in 75–80% of the cells within the first 3 hours after treatment with 1µg prostaglandin E1/ml and 25µg papaverine/ml. The percentage of cells with neurites began to decrease within 24 hours after initiation of treatment, even in the continued presence of drugs. Moreover, neurite extensions were reversible even after 4 days of continuous drug exposure. Although NB4 cells and a number of clones derived from them contain acetylcholine and choline acetyltransferase activity, acetylcholine content and transferase activity were not significantly altered after treatment with prostaglandin E1 and papaverine. Cultures of NB4 cells treated with 1µg prostaglandin E1/ml and 25µg papaverine/ml stopped proliferating. Treated cultures had a prolonged population doubling time compared to control cultures for the initial 48 hours after replating in drug-free medium. After 144 hours, cultures from treated cells attained a cell density that was not statistically different from that of control cultures. The initially prolonged population doubling time in the treated cell cultures was due to a decrease in the number of dividing cells rather than to a prolonged cell cycle time. The tumorigenicity of treated cells was less than that of control cells. Fourfold more treated than control cells were needed to produce tumors in 50% of inoculated mice. Animals inoculated with treated cells had an increased mean latent period for the development of a palpable tumor mass and an increased survival time. Decreased malignancy of the treated cell population appeared to result from the loss of proliferative capacity without a concomitant irreversible change in the state of differentiation.