Retinoids are capable of modulating cellular differentiation and proliferation. Retinoids mediate gene function through a series of nuclear receptors. The retinoic acid receptor beta (RAR beta) has been shown to play an important role in the differentiation of a number of cell types. RAR beta is either absent or expressed at extremely low levels in a number of tumor types including breast carcinoma. It was demonstrated that transfection of RAR beta gene in breast carcinoma cell with its subsequent expression resulted in inhibition of cell growth. Retinoic acid significantly inhibited monolayer growth of the breast carcinoma cells expressing RAR beta, while it had no effect on the growth of the control cells. The RAR beta expressing cells formed much smaller and fewer colonies in soft agar and were significantly less tumorigenic in nude mice than the controls. These results suggest that RAR beta may function as a tumor suppressor in breast carcinoma cells.