We report the establishment of a model of neural differentiation in four well-characterized Ewing's sarcoma cell lines. This process was induced by serum-depleted medium (1% fetal bovine serum) and agents such as dibutyryl cyclic AMP and retinoic acid. The morphologic changes were characterized predominantly by the presence of neurite-like elongated processes showing varicosities and branching along their course with numerous internal filaments and electron-dense granules. Immunocytochemically, differentiation was accompanied by a considerable increase in reactivity for neural markers of several types: neuroblastic, neuroepithelial, neuroendocrine, Schwannian and even glial. In contrast, the tumor promoter, phorbol 12-myristate 13-acetate inhibited differentiation. Several morphologic changes were observed in phorbol 12-myristate 13-acetate-treated cells: the cells became smaller and rounder, were poorly adherent to substrate, by electron microscopy lacked cytoplasmic organelles, electron-dense granules or neural processes, and showed decreased expression of neural markers. Northern blot analysis was performed to establish whether there was any relationship between neural differentiation and degree of N-myc, c-myc and dbl oncogene expression. There was no N-myc oncogene expression in the mRNA of Ewing's sarcoma cells, even after neural induced differentiation. The degree of c-myc and dbl oncogene expression appeared heterogeneous, and varied with the culture condition. Based on these results, it may be inferred that Ewing's sarcoma cells in vitro display a variable neural phenotype, there being a variety of biologic responses to diverse culture media and various differentiation agents, but with no consistent effect on N-myc, c-myc and dbl oncogene expression.