Changes to cell cycle-regulating machinery that occur during differentiation of cells are thought to be responsible mostly for withdrawal from cycling. Here, embryonal carcinoma (EC) cell lines were found that differ in their basal levels of p27 inhibitor of cyclin-dependent kinases but not in their growth rates, distribution of cells in phases of cell cycle, and their ability to differentiate. High basal levels of p27 did not substitute for up-regulation of p27 that in EC cells normally occurs early after entering a differentiation pathway. Under both standard and differentiation-supporting culture conditions, variances in the levels of p27 were strictly followed by variances in the levels of cyclins D2 and D3. In EC cells genetically manipulated to overexpress p27 protein, cyclin D3 became up-regulated and vice versa. Supposedly, titration of p27 by D-type cyclins, which prevents its inhibitory action toward cyclin-dependent kinase 2, allows for the maintenance of elevated p27 in proliferating EC cells. Increased levels of p27 in early embryonal cells thus may, at least in certain phases of embryo development, serve a differentiation-associated, rather than proliferation-associated, function.