In this study, we examined the effect of expression of tissue inhibitor of metalloproteinases-2 (TIMP-2) on the growth and dissemination of a highly metastatic human melanoma cell line (M24net). M24net melanoma cells express a number of matrix metalloproteinases (MMPs), including gelatinase A and B (MMP-2 and MMP-9) and interstitial collagenase (MMP-1) (A. M. P. Montgomery et al., Cancer Res., 53: 693-700, 1993). The activity of these proteases was effectively down-regulated by transfecting M24net cells with complementary DNA-encoding human TIMP-2. Overexpression of TIMP-2 markedly reduced melanoma growth in the skin of immunodeficient mice but did not prevent these highly malignant cells from spontaneously metastasizing to the lungs and lymph nodes of inoculated mice. We provide a mechanism to account for the growth inhibitory property of TIMP-2 based on its ability to regulate M24net cell growth in three-dimensional interstitial collagen. In the presence of this matrix, M24net cells assume a differentiated morphology and have a reduced growth rate. We present evidence that overexpression of TIMP-2 increases the susceptibility of M24net cells to growth inhibition and morphological differentiation by occluding interstitial collagen.