When a 13-day-old chick embryonic tarsometatarsal skin was cultured for 4 days in medium containing hydrocortisone (20 nM) and 5% delipidized fetal calf serum (FCS), epidermal growth factor (EGF, 100 ng/ml) decreased epidermal DNA content 42% and inhibited epidermal DNA synthesis 87%. Tonofilament bundles within the basal and intermediate cells of the EGF-treated epidermis were not as conspicuous as those in the glucocorticoid-induced keratinized epidermis, and the upper region of the EGF-treated epidermis did not form either the filament bundles or the electron-dense amorphous masses seen in the cytoplasm of the glucocorticoid-induced keratinized layer. EGF stimulated degradation of glucocorticoid-induced alpha-keratin. Furthermore, EGF caused a twofold increase in glucocorticoid-induced epidermal transglutaminase activity and in the amount of epidermal glucocorticoid receptor. In the absence of FCS, however, EGF did not inhibit steroid-induced alpha-type keratinization and did not affect either steroid-induced epidermal transglutaminase activity or amount of epidermal glucocorticoid receptor. Hence, the effect of EGF on glucocorticoid-induced epidermal transglutaminase activity was observed only in the presence of delipidized FCS and might be supported by an increase in the amount of glucocorticoid receptor.