The C3H/10T1/2 CL8 cell line (10T1/2) is being widely used as a quantitative assay system for chemical and physical carcinogens. 10T1/2 cells, but not their transformed counterparts, exhibit a decreased final saturation density with decreasing serum concentration. Exposure of carcinogen-treated cultures to 5% serum 8 days posttreatment led to a 2- to 6-fold enhancement in transformation frequency in comparison with cultures maintained in 10% serum throughout. Exposure 14,21, or 28 days posttreatment also caused enhancement of transformation frequency, provided a sufficient time for expression of the malignant phenotype was allowed. Exposure to 5% serum 1 or 2 days posttreatment did not lead to significant enhancement of transformation frequency. In contrast, exposure to 15 or 20% serum after 8 days virtually abolished the expression of malignancy; however, this inhibition could be reversed by 5% serum. Morphologically transformed foci isolated from cultures exposed to 5% serum produced clones in agarose with the same frequency as did foci isolated from cultures exposed to 10% serum. Reconstruction experiments, utilizing confluent monolayers of 10T1/2 cells overlaid with transformed cells, demonstrated that the growth of transformed cells decreased proportionally with the log of serum concentration. This effect was not caused by depletion of medium and was dependent upon the presence of 10T1/2 cells. It is concluded that the expression of malignancy in this system is governed by the serum-modulated cell density of the mass of non-transformed cells in the culture.