Basic fibroblast growth factor (bFGF) is a potent growth and angiogenic factor that is found in abundance in tissues such as brain, hypothalamus, kidney and cartilage. Despite this copious production of bFGF, most of these tissues are not undergoing either active growth or angiogenesis, suggesting that bFGF activity must be regulated so as to prevent autostimulation of cell growth. In cultured cells, bFGF is associated mainly with cells and basement membranes and is not released into the medium. Prevention of release could be a mechanism for regulation of bFGF activity and may be a consequence of the apparent absence of a secretory-signal sequence in the bFGF protein. Here we investigate whether this regulation can be overridden through the forced secretion of bFGF. Such secretion might provide the bFGF access to its receptor and in turn lead to autocrine transformation of the cell. We report that bFGF, as specified by a recombinant plasmid, is itself unable to induce such transformation, but acquires this ability after fusion with a secretory-signal sequence. The resulting transformants undergo unusual morphological alteration and display tumorigenicity.