We have previously presented evidence that cell-cell contact is the normal developmental signal to deactivate discoidin I gene expression in D discoideum [Berger EA, Clark JM: Proc Natl Acad Sci USA 80:4983, 1983]. Here we provide genetic evidence to support this hypothesis by examining gene expression in a cohesion-defective mutant, strain EB-21, which enters the developmental program but is blocked at the loose mound stage. When this strain was developed in suspension, the cells remained almost entirely as single amoebae, unlike the wild type, which formed large multicellular aggregates. In both strains, discoidin I mRNA levels were low in vegetative cells but rose sharply during the first few hours of development. However, the peak level reached at 8 hr in EB-21 exceeded that observed in wild type, and while the level declined markedly over the next few hours in wild type, it remained highly elevated in the mutant. Thus, there was a correlation between the inability of EB-21 to form normal cell-cell contacts and its deficiency in inactivating discoidin I gene expression. Previous studies from several laboratories, including this one, have demonstrated that exogenously added cAMP can block or reverse the changes in gene expression normally seen upon cell disaggregation. This has led us to propose that cAMP serves as a second messenger regulating the expression of contact-regulated genes. Here we provide additional support for this hypothesis. Intracellular cAMP levels rapidly dropped several-fold when wild type tight cell aggregates were disaggregated and remained low as the cells were cultured in the disaggregated state. Furthermore, overexpression of discoidin I mRNA late in development in EB-21 was corrected by addition of high concentrations of cAMP. These results are consistent with a second messenger function for cAMP in the contact-mediated regulatory response, and they indicate that the cAMP response machinery for discoidin I gene expression is capable of functioning in the cohesion-defective EB-21 strain.