A system of heterokaryons has been used to study the inhibition of proliferation in terminally differentiated cells. Methods for cell fusion and heterokaryon identification were also improved and a highly efficient method for large-scale cellular enucleation that avoided the use of chemical agents was established. Two types of terminally differentiated cells (neutrophils and nucleated erythrocytes), taken directly from the animal, were shown to possess intracellular inhibitors that prevented the nuclei of nonmalignant proliferating cells to which they were fused from entering S-phase. However, malignant cells were much less sensitive to the suppressive effect of erythrocyte or neutrophil nuclei in heterokaryons. Reactivation of DNA synthesis in macrophage nuclei in heterokaryons was found to require immortalization of the partner cells and was dependent on the presence of immortalizing oncogenes in the partner cell. These results may be useful for testing for cellular immortality in culture. Macrophage heterokaryons can be used to distinguish between normal or near normal (spontaneously immortalized) cells and tumor or oncogene-transformed cells by the suppression of DNA synthesis in the nuclei of the latter. The complete and irreversible inhibition of DNA replication in both nuclei of heterokaryons produced by fusing two different proliferating cells (fibroblasts and leukemic cells) has been shown for the first time. These results suggest that more than one factor is involved in the suppression of replication in terminally differentiated cells.