In this study we have examined possible differentiation-dependent modulations in plasma membrane lipid properties in normal keratinocytes, SV-40 transformed keratinocytes (SVK14) and a number of squamous carcinoma (SCC) cells. In normal keratinocytes the lateral diffusion coefficient of plasma membrane lipids (D) differs significantly for cells cultured permanently under low and normal Ca2+-conditions (5.16 x 10(-9) and 3.27 x 10(-9) cm2/s, respectively). When differentiation is induced by exposing low Ca2+-cultured cells to normal Ca2+ concentrations D increases to 7.07 x 10(-9) cm2/s during the initial hours of differentiation followed by a gradual sustained decrease to values also observed in cells cultured permanently under normal Ca2+-conditions. In SCC and SVK14 cells a similar initial transient increase in lateral lipid mobility is observed upon initiation of differentiation, but, in contrast to normal keratinocytes, no sustained decrease in D is seen upon prolonged culturing under normal Ca2+ conditions. The results indicate that the deficiency of the transformed cells to respond to Ca2+-induced differentiation might involve transformation-dependent alterations in membrane structure and function.