The retinoblastoma protein (Rb) is a tumour suppressor that is activated by dephosphorylation the function of which appears to be mediated, at least partly, through the inhibition of several transcription factors, such as E2F. We have recently described sphingosine, a sphingolipid-breakdown product, as a potent and specific inducer of Rb dephosphorylation resulting in inhibition of cell growth and a specific arrest in the G0/G1 phase of the cell cycle. Here we examine the role of Rb and its interaction with E2F in mediating the effects of sphingosine on cell growth. Sphingosine potently inhibited growth of lymphoblastic leukaemic cells, Molt-4, at submicromolar concentrations but showed a 10-fold reduced potency in inhibiting growth of retinoblastoma cells, WERI-Rb-1, which lack functional Rb. In addition, sphingosine's ability to inhibit growth of mink lung epithelial cells was significantly attenuated in cells overexpressing simian virus 40 large T antigen which binds Rb and related proteins. Sphingosine treatment of Molt-4 cells, but not WERI-Rb-1 cells, resulted in the loss of the specific E2F bands produced by the interaction of E2F and its specific DNA sequence element on gel-shift assays. The concentration (submicromolar) and kinetics (4 h) of sphingosine treatment were identical with those required to induce Rb dephosphorylation. In addition, at similar concentrations, sphingosine caused c-myc down-regulation in Molt-4 cells starting at 6 h after treatment. These results demonstrate that activation of Rb by sphingosine leads to sequestration of E2F by the active (hypophosphorylated) form of Rb with the resultant loss of its DNA-binding and genetranscribing abilities. A functional Rb is required to mediate the specific effects of sphingosine on growth arrest.