Glucagon responsiveness was selectively lost in a dog kidney cell line, MDCK cells, after transformation by Harvey murine sarcoma virus and this loss can be restored to the transformed cells by culturing the cells in the presence of prostaglandin E2. The induction by PGE2 seems to be mediated by cyclic AMP. We are currently examining the role of cyclic AMP-dependent protein kinase in the induction process. In order to define the nature of this cyclic AMP-dependent process, we have studied several differentiation inhibitors which inhibit the induction of glucagon responsiveness by PGE2. Epidermal growth factor inhibits the induction by PGE2 in a concentration dependent manner, but does not have detectable effect on the ability of PGE2 to activate cyclic AMP production. We have also found that EGF receptors become desensitized during the induction. It has been shown that EGF receptors can be phosphorylated not only by a EGF-induced process but also by a cyclic AMP-dependent pathway. We have now identified the EGF receptors in the transformed MDCK cells on SDS-PAGE by 35S-methionine labeling followed by immunoprecipitation. We are currently examining the phosphorylation of EGF receptors under the induction condition and when the induction of differentiation is inhibited.