Tumor-derived Syrian hamster embryo (SHE) cell lines, induced in vitro by treatment with chemical carcinogens, contained increased levels of pp60c-src kinase activity compared to preneoplastic parental cell lines and normal SHE cells. The increased kinase activity did not result from an increase in the pp60c-src content of the SHE cell lines, but represented a 4-11 fold increase in pp60c-src kinase specific activity. Both the extent of phosphorylation and the velocity of pp60c-src phosphotransferase activity were increased in the tumor-derived cell lines. SHE cell lines producing chicken pp60c-src were isolated following co-transfection with plasmids bearing the chicken c-src and neoR genes. Chicken pp60c-src expressed in an asbestos-transformed, tumor-derived cell line showed an approximate 3-fold activation of tyrosine kinase activity compared to chicken pp60c-src expressed in the preneoplastic cell line. We suggest that these results indicate that activation of pp60c-src is mediated by trans-acting cellular factors present in the tumor-derived cells. Analysis of pp60c-src in normal SHE cells, preneoplastic cell lines and tumor-derived cell lines showed no alteration in the phosphorylation of tyr-527 or tyr-416, two tyrosine residues whose phosphorylation states have been associated with modulation of kinase activity. These studies indicate that the neoplastic progression of cells may be accompanied by the activation of proto-oncogene products, such as the pp60c-src tyrosine kinase, by mechanisms that may not directly involve genetic alteration of the proto-oncogene DNA sequence.