Human promyelocytic cells lines treated with conditioned medium from PHA-stimulated leukocytes acquire several phenotypic and functional markers of differentiated monocytes. In this paper, we demonstrate that promyelocytic cells treated with conditioned medium express, among other markers, monocyte-specific and HLA-DR antigens absent from the parental cells and become potent effectors of antibody-dependent cell-mediated cytotoxicity against erythrocytes and tumor cells. In cultures of promyelocytic cell lines maintained in the presence of conditioned medium, an equilibrium between proliferation and differentiation is established, and two cell populations can be separated on the basis of expression of differentiation surface markers. One population has a differentiated morphology, expresses nonspecific esterase activity, Fc receptors, C receptors, monocyte-specific and HLA-DR antigens, is able to mediate antibody-dependent cytotoxicity, and has a limited ability to proliferate. A second population retains the phenotype of undifferentiated promyelocytes and continues to proliferate. The differentiated monocyte-like cells originate from a proportion of the proliferating promyelocytes that respond to the differentiation inducers contained in the conditioned medium.