Chronic infection/inflammation of the urinary tract is a significant risk factor for the development of bladder cancer. The present study examined the hypothesis that hydrogen peroxide (H202) and cytokines released during inflammation are involved in the enhancement of bladder carcinogenesis. Using growth in soft agar and tumorigenicity in athymic nude mice as indices of transformation, we examined the effect of H202 and cytokines on the enhancement of N-methyl-N-nitrosourea (MNU)-initiated transformation of MYP3 cells, an anchorage-dependent nontumorigenic rat bladder epithelial cell line. MYP3 cells pretreated with or without MNU were exposed to H202 (0.001 to 0.1 mM) daily for 1 week in monolayer culture and were then tested for growth in soft agar. A marked increase in colony numbers was observed in the cells that were MNU-initiated and exposed to H202 (P < 0.01). Furthermore, H202 exposure alone at 0.01 mM or 0.1 mM caused colony formation in soft agar. The transformants induced by MNU plus H202 or H202 alone formed high-grade transitional cell carcinomas when injected into nude mice. The growth of these transformants was stimulated by several cytokines (interleukin 1alpha, interleukin 6, and tumor necrosis factor-alpha) better than the parental cells both on a plastic surface and in soft agar. Our results indicate that H202 causes genetic change(s) to induce tumorigenic conversion in urothelial cells and that the transformants are stimulated to grow because of their selective response to several cytokines. We suggest that these mechanisms may be involved in the in vivo carcinogenesis associated with chronic urinary tract infection.