Summary. The cyclin‐dependent kinase inhibitor p27Kip1 is a key regulator of the G1/S transition, and an inverse relationship between p27Kip1 protein expression and proliferation index has been reported in malignant lymphomas. However, a subset of aggressive B‐cell lymphomas demonstrates high p27Kip1 expression despite a high proliferation index. The aim of this study was to determine potential mechanisms by which lymphoma cells abrogate the growth inhibitory effect of high p27Kip1. The effect of transforming growth factor‐β (TGF‐β) and serum stimulation on p27Kip1 expression and cyclin E/cdk2 activity was investigated in four lymphoma cell lines, Jurkat, CEM‐6, OCI‐Ly1 and Nalm‐6. Reactive lymphocytes responded to growth inhibitory TGF‐β by inducing p27Kip1 expression, with subsequent accumulation of cells in G0/G1. In contrast, TGF‐β did not alter the level of p27Kip1 in Jurkat, CEM‐6 and OCI‐Ly1 cells with no change in cyclin E/cdk2‐kinase activity. Serum stimulation also did not result in a significant change in p27Kip1 expression. Western blot analysis of subcellular fractions demonstrated cytoplasmic p27Kip1, corroborated by immunocytochemistry in a subset of the lymphoma cells. Sequestration of p27Kip1 by cyclin D3 was observed in the nuclear and cytoplasmic fractions of Nalm‐6, OCI‐Ly‐1 and NCEB cells. These results indicate that multiple mechanisms contribute to the abrogation of growth regulation by unscheduled high p27Kip1 protein expression including deficient response to TGF‐β and serum, sequestration by cyclin D3 and cytoplasmic displacement.