The role of transforming growth factor alpha (TGF alpha) and prostaglandins (PGs) in the preferential growth of preneoplastic liver cells was studied. Rats received the genotoxic hepatocarcinogen N-nitrosomorpholine (NNM); placental glutathione S-transferase (GSTp) was used as a marker to identify preneoplastic foci. Preneoplastic foci expressing TGF alpha (TGF alpha (+)) grew more rapidly than TGF alpha negative (TGF alpha (-)) ones. Almost all tumours studied were positive for TGF alpha. The key enzymes of prostaglandin synthesis, cyclooxygenase I (Cox-1) and II (Cox-2), were present in all unaltered and preneoplastic cells and tended to decrease in the later stages of hepatocarcinogenesis. Immunostaining revealed that cultures of hepatocytes, isolated from NNM-treated livers by collagenase perfusion, contained 1-2% GSTp-positive (GSTp(+)) and 9% TGF alpha (+) hepatocytes; 0.6% of the cells were GSTp(+)/TGF alpha (+). Cox-1 and Cox-2 were present in all cells. DNA replication was almost exclusively associated with expression of TGF alpha. GSTp(+) hepatocytes showed a 3- to 4-fold higher probability of TGF alpha expression and of DNA synthesis than GSTp-negative (GSTp(-)) cells. PGE(2) or PGF(2 alpha) increased expression of TGF alpha and DNA replication in GSTp- cells but not in GSTp(+) cells. PGA(2) and PGJ(2) decreased DNA synthesis in TGF alpha (+) cells without an obvious effect on the intracellular levels of TGF alpha. The Cox-2 inhibitor SC236 suppressed DNA replication preferentially in GSTp I cells; this inhibition was reversed by PGE(2)/F-2 alpha. Indomethacin had no effect. These results suggest the following conclusions. (i) Growth regulation of preneoplastic GSTp+ cells in culture exhibits distinct differences from GSTp- cells and elevated expression of TGF alpha contributes to their growth advantage. (ii) TGF alpha renders preneoplastic hepatocytes sensitive to suppression of DNA synthesis by PGA(2)/J(2). (iii) SC236, a Cox-2 inhibitor, may have preventive value in hepatocarcinogenesis.