We have investigated the effect of type beta transforming growth factor (TGF-beta) on the differentiation of skeletal muscle myoblasts. TGF-beta potently (ID50 approximately 10 pM) prevents established cell lines and primary cultures of rat and chicken embryo myoblasts from fusing into multinucleated myotubes. Inhibition of morphological differentiation by TGF-beta correlates with inhibition of the expression of muscle-specific mRNAs and proteins, strong induction of extracellular matrix type I collagen and fibronectin, and a marked tendency of the treated myoblasts to aggregate into densely multilayered arrays or clusters. Myogenic differentiation can resume after removal of TGF-beta from the medium. Examination of the time of action of TGF-beta shows that myoblasts stochastically reach a point beyond which they become insensitive to the inhibitory action of TGF-beta. This resistance of committed myoblasts to the inhibitory action of TGF-beta is not associated with any measurable change in the number or affinity of TGF-beta receptors in those cells. The results indicate that TGF-beta is a potent inhibitor of myogenesis and may regulate muscle development in vivo.