Two receptor serine/threonine kinases (types I and II) have been identified as signaling transducing activin receptors. We studied the possibility of inhibiting activin A-dependent differentiation in K562 cells, using a dominant negative mutant of type II receptor. A vector was constructed expressing activin type II truncated receptor (ActRIIa) that lacks the cytoplasmic kinase domain. Since activin type I and II receptors form heteromeric complexes for signaling, the mutant receptors compete for binding to endogenous receptors, hence acting in a dominant negative fashion. K562 cells were stably transfected with ActRIIa, and independent clones were expanded. The truncated cDNA was integrated into the genome of the transfectants, as shown by polymerase chain reaction; and the surface expression of truncated receptors was shown by affinity cross-linking with (125)I-activin A. In wild-type K562 cells, activin A induced erythroid differentiation and cells started to express hemoglobins. In transfected cells expressing ActRIIa, the induction of erythroid differentiation was abrogated and less than 10% of cells were hemoglobin-containing cells after culture with activin A. Further transfection with wild-type type II receptors rescued the mutant phenotype of these transfectants, indicating that the effect of ActRIIa is dominant negative. In addition, phosphorylation of the cytoplasmic kinase domain of the type II receptor in vitro confirms the autophosphorylation of this portion of the receptor. Therefore, induction of erythroid differentiation in vitro is mediated through the cell surface activin receptor, and interference with this receptor signaling inhibits this process of differentiation in K562 cells.