Single-cell RNA-sequencing technologies suffer from many sources of technical noise, including under-sampling of mRNA molecules, often termed ‘dropout’, which can severely obscure important gene-gene relationships. To address this, we developed MAGIC (Markov Affinity-based Graph Imputation of Cells), a method that shares information across similar cells, via data diffusion, to denoise the cell count matrix and fill in missing transcripts. We validate MAGIC on several biological systems and find it effective at recovering gene-gene relationships and additional structures. MAGIC reveals a phenotypic continuum, with the majority of cells residing in intermediate states that display stem-like signatures and uncovers known and previously uncharacterized regulatory interactions, demonstrating that our approach can successfully uncover regulatory relations without perturbations.

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Tissue damage increases cancer risk through poorly understood mechanisms 1 . In the pancreas, pancreatitis associated with tissue injury collaborates with activating mutations in the Kras oncogene to dramatically accelerate the formation of early neoplastic lesions and ultimately pancreatic cancer 2 , 3 . By integrating genomics, single-cell chromatin assays and spatiotemporally-controlled functional perturbations in autochthonous mouse models, we show that the combination of Kras mutation and tissue damage promotes a unique chromatin state in the pancreatic epithelium that distinguishes neoplastic transformation from normal regeneration and is selected for throughout malignant evolution. This cancer-associated epigenetic state emerges within 48 hours of pancreatic injury, and involves an acinar-to-neoplasia ‘chromatin switch’ that contributes to the early dysregulation of genes defining human pancreatic cancer. Among the genes most rapidly activated upon tissue damage in the pre-malignant pancreatic epithelium is the alarmin cytokine IL-33, which cooperates with mutant Kras in unleashing the epigenetic remodeling program of early neoplasia and neoplastic transformation in the absence of injury. Collectively, our study demonstrates how gene-environment interactions can rapidly produce gene regulatory programs that dictate early neoplastic commitment and provides a molecular framework for understanding the interplay between genetics and environmental cues in cancer initiation.