Transforming growth factor beta 1 (TGF-beta 1) added to L6E9 rat skeletal myoblasts in mitogen-rich medium induces a rapid decrease in c-myc expression and delays progression through the G1 phase of the cell cycle. This growth inhibitory response is followed by cell commitment to terminal differentiation with elevated expression of myogenin muscle determination genes, induction of muscle-specific proteins, and formation of multinucleated myotubes. These results suggest that TGF-beta 1 may act as a physiological inducer of myogenic differentiation in mitogen-rich environments, and its otherwise reversible growth inhibitory effect may become permanent if coupled to induction of terminal differentiation.