The Faza 967 'differentiated', dexamethasone (DEX)-sensitive cell line of Reuber rat hepatoma cells does not synthesize detectable amounts of alpha-fetoprotein (AFP), whereas it does produce albumin. AFP production was activated in 'differentiated' variants of Faza 967 cells with reduced glucocorticoid sensitivity upon culture for several months in the presence of high concentrations of dexamethasone. The stability of AFP production differed among the variants, while albumin synthesis did not change, thus indicating that the regulation of these two genes is not co-ordinated. Using molecular hybridization techniques, we found that the AFP message could not be detected in the non-AFP-producing cells, suggesting that the lack of AFP synthesis most probably originates from a transcriptional block of the AFP gene. AFP-producing and non-AFP-producing variants of Faza 967 cells constitute a valuable model system for studying the regulatory mechanisms involved in the activation and inactivation of the gene coding for the oncodevelopmental protein, AFP.