Chondrocytes express a well-characterized set of marker proteins making these cells useful for studies on differentiation and regulation of gene expression. Because of the inherent instability of primary rat chondrocytes in culture, and because several rat chondrocyte genes have been cloned and characterized (including the collagen II promoter and enhancer), a rat chondrocyte cell line would be especially useful. To obtain this line we infected primary fetal rat costal chondrocytes with a recombinant retrovirus (NIH/J-2) carrying the myc and raf oncogenes, which have been shown to have an "immortalizing" function. Following infection, a rapidly proliferating clonal line was isolated that maintained a stable phenotype through 45 passages (11/2 year in culture). This line, termed IRC, grows in suspension culture as multicellular aggregates and in monolayer culture as polygonal cells which accumulate an alcian blue-stainable matrix. IRC cells synthesize high levels of cartilage proteoglycan core protein, and link protein, but show reduced collagen II expression. In addition, the cells express virally derived myc mRNA and protein, but do not express v-raf. Retinoic acid, which is a known modulator of chondrocyte phenotype, down-regulates expression of chondrocyte marker proteins, while stimulating v-myc expression by IRC cells. These data suggest that v-myc expression by chondrocytes results in rapid cell division and maintenance of many aspects of the differentiated phenotype. These "immortalized" cells, however, remain responsive to agents such as retinoic acid which modulate cell phenotype. The potential exists for development of chondrocyte cell lines from diseased cartilage, as well as from human cartilage.