One obvious phenotype of tumor cells is the lack of terminal differentiation. We previously classified rhabdomyosarcoma cell lines as having either a recessive or a dominant nondifferentiating phenotype. To study the genetic basis of the dominant nondifferentiating phenotype, we utilized microcell fusion to transfer chromosomes from rhabdomyosarcoma cells into C2C12 myoblasts. Transfer of a derivative chromosome 14 inhibits differentiation. The derivative chromosome 14 contains a DNA amplification. MDM2 is amplified and overexpressed in these nondifferentiating hybrids and in the parental rhabdomyosarcoma. Forced expression of MDM2 inhibits MyoD-dependent transcription. Expression of antisense MDM2 restores MyoD-dependent transcriptional activity. We conclude that amplification and overexpression of MDM2 inhibit MyoD function, resulting in a dominant nondifferentiating phenotype.Rhabdomyosarcomas are one of the most common solid tumors of childhood. Sarcomas have traditionally been classified as rhabdomyosarcomas on the basis of morphology and the expression of muscle structural genes, such as that for the myosin heavy chain (MHC) or desmin. Expression of MyoD has been shown to be the most sensitive marker for classifying sarcomas as rhabdomyosarcomas (4, 38). Rhabdomyosarcomas are grouped by histologic and cytogenetic criteria as either embryonal or alveolar rhabdomyosarcomas: a balanced translocation between chromosomes 2 and 13, t(2;13)(q35;q14), is associated with alveolar rhabdomyosarcomas (1). The PAX3 gene has been shown to be fused to a member of the forkhead gene family in the t(2;13) translocation (1, 39). Loss of heterozygosity on the short arm of chromosome 11 encompassing 11p15.5 is associated not only with embryonal rhabdomyosarcomas (38) but also with a number of other solid tumors (26), suggesting the location of a tumor suppressor gene(s) for multiple tumor types in this region.Recently, we have begun an analysis of five rhabdomyosarcoma cell lines (RD, Rh18, Rh28, Rh30, and RhJT) for expression and function of the MyoD family (42). We showed that even though MyoD is expressed in rhabdomyosarcoma cells, it is nonfunctional in inducing differentiation. Heterokaryon formation between 10T1/2 cells and RD, Rh28, Rh30, and RhJT cells results in differentiation of the heterokaryons into muscle and restoration of transcriptional activation by MyoD, indicating that these tumor lines display a recessive nondifferentiating phenotype. In contrast, heterokaryon formation with the rhabdomyosarcoma Rh18 and 10T1/2 cells did not result in myogenesis, suggesting that Rh18 cells display a dominant nondifferentiating phenotype.In this paper, we show that transfer of a derivative chromosome 14 from Rh18 cells into the differentiation-competent myoblast cell line C2C12 inhibits muscle differentiation and the ability of MyoD to function as a transcription factor. The derivative chromosome 14 contains a region of amplified DNA originating from chromosome 12 and contains a number of genes often amplified in sarcomas, ...