Gangliosides appear to be important recognition molecules on the cell surface and have been implicated as receptors for certain bacterial toxins and viruses. Little is known, however, about the normal physiological role(s) of these plasma membrane components. We found that NIH 3T3 cells transformed by the ras oncogene expressed lower amounts of complex gangliosides GM1 and GD1a on the cell surface compared to normal contact-inhibited NIH 3T3 cells. Similar results were obtained with cells transformed by several variants of ras including those derived from human tumors. In addition, rapidly dividing as well as mitogen-stimulated NIH 3T3 cells had lower levels of surface GM1 and GD1a than their confluent, quiescent counterparts. To explore the role of surface gangliosides in cell growth, we used the B or binding subunit of cholera toxin as a specific probe for surface GM1. The only known function of the B subunit, which is multivalent, is to bind to the oligosaccharide chain of GM1. Exposure of quiescent 3T3 cells to the B subunit resulted in a proliferative response as measured by increased DNA synthesis and cell numbers. The B subunit potentiated the effects of other mitogens such as epidermal growth factor. In contrast, the B subunit inhibited the growth of transformed 3T3 cells as well as that of rapidly dividing normal 3T3 cells. Thus, gangliosides may play a role as membrane transducers of both positive and negative signals that regulate cell growth.