Phosphorylation/inactivation of RB is typically required for cell cycle progression. However, we have identified a tumor cell line, C33A, which progresses through the cell cycle in the presence of an active allele of RB (PSM-RB). To determine how C33A cells evade RB-mediated arrest, we compared RB signaling to downstream effectors in this resistant cell line to that of the RB-sensitive SAOS-2 cell line. Although introduction of PSM-RB repressed E2F-mediated transcription in both C33A and SAOS-2 cells, PSM-RB failed to repress Cyclin A promoter activity in C33A. Ectopic expression of PSM-RB in SAOS-2 cells resulted in a decrease in both Cyclin A and Cdk2 protein levels without affecting Cyclin E or Cdk4. In contrast, over-expression of PSM-RB in C33A cells did not alter endogenous Cyclin A, Cyclin E, or Cdk2 protein levels or impact Cdk2 kinase activity, indicating that signaling from RB to down-stream targets is abrogated in this cell line. The importance of Cdk2 activity was demonstrated by p27Kip1, which attenuated Cdk2 activity and inhibited cell cycle progression in C33A cells. Since RB signaling to Cdk2 is disrupted in these tumor cells, we co-expressed two proteins that cooperate with RB in transcriptional repression, AHR and BRG-1, in an attempt to correct this signaling dysfunction. Co-expression of AHR/BRG-1 with PSM-RB attenuated Cyclin A and Cdk2 expression as well as Cdk2-associated kinase activity, resulting in cell cycle inhibition of C33A cells. Importantly, ectopic expression of Cyclin A was able to reverse the arrest mediated by co-expression of AHR/BRG-1 with PSM-RB. These results indicate that down-regulation of Cdk2 activity is requisite for RB-mediated cell cycle arrest. Thus, this study reveals a new mechanism through which tumor cells evade anti-proliferative signals, and provides insight into how RB-signaling is mediated.