Transforming growth factor β (TGF) is a well‐known inhibitor of myogenic differentiation as well as an autocrine product of rhabdomyosarcoma cells. We studied the role of the TGF‐β autocrine loop in regulating growth and myogenic differentiation in the human rhabdomyosarcoma cell line, RD. We previously reported that the phorbol ester 12‐O‐tetradeca‐noylphorbol‐13‐acetate (TPA) induces growth arrest and myogenic differentiation in these cells, which constitutively express muscle regulatory factors. We show that TPA inhibits the activation of secreted latent TGF‐β, thus decreasing the concentration of active TGF‐β to which the cells are exposed. This event is mediated by the TPA‐induced alteration of the uPA/ PAI serine‐protease system. Complete removal of TGF‐β, mediated by the ectopic expression of a soluble type II TGF‐β receptor dominant negative cDNA, induces growth arrest, but does not trigger differentiation. In contrast, a reduction in the TGF‐β concentration, to a range of 0.14–0.20 × 10⁻² ng/ml (which is similar to that measured in TPA‐treated cells), mimics TPA‐induced differentiation. Taken together, these data demonstrate that cell growth and suppression of differentiation in rhabdomyosarcoma cells require overproduction of active TGF‐β; furthermore, they show that a ‘critical’ concentration of TGF‐β is necessary for myogenic differentiation to occur, whereas myogenesis is abolished below and above this concentration. By impairing the TGF‐β autocrine loop, TPA stabilizes the factor concentration within the range compatible for differentiation to occur. In contrast, in human primary muscle cells a much higher concentration of exogenous TGF‐β is required for the differentiation inhibitory effect and TPA inhibits differentiation in these cells probably through a TGF‐β independent mechanism. These data thus clarify the mechanism underlying the multiple roles of TGF‐β in the regulation of both the transformed and differentiated phenotype.—Bouche, M., Canipari, R., Mel‐chionna, R., Willems, D., Senni, M. I., Molinaro, M. TGF‐β autocrine loop regulates cell growth and myo‐genic differentiation in human rhabdomyosarcoma cells. FASEB J. 14, 1147–1158 (2000)