The ability of bone marrow cells, obtained from mice pretreated with the synthetic glucocorticoid dexamethasone, to form erythroid colonies in vitro was studied. The results show that these bone marrow cells form a reduced number of erythroid colonies in vitro in response to Epo. This effect is evident after single injection (1 mg, intraperitoneally) of dexamethasone (46% of control values) and is at a maximum after two to four consecutive treatments (12% to 17% of control values). In order to eliminate the influence of either influx or efflux of cells to or from the bone marrow, the effect of dexamethasone on erythroid colony formation in vitro was examined. In these experiments, bone marrow cells cultured in the presence of Epo (25 microU) and dexamethasone (2 X 10(-6)M to 2 X 10(-8)M) formed fewer erythroid colonies than cells cultured in the presence of Epo alone. The ability of the antiglucocorticoid, 17 alpha-methyltestosterone (2 X 10(-7)M) to reverse this dexamethasone-mediated inhibition of erythroid colony formation suggests that this phenomenon is mediated through a glucocorticoid receptor. These studies show therefore that dexamethasone, either in vivo or in vitro, decreases the number and/or functional capacity of adult murine bone marrow cells capable of forming erythroid colonies in vitro in response to Epo, although the precise mechanism of this inhibition remains to be established.