Using the fluorescence-activated cell sorter, we have isolated a population of variant mouse hepatoma cells which have a markedly increased ability to metabolize benzo(a)pyrene. Compared with wild-type (Hepa 1c1c7) cells, the variant cells exhibit increased aryl hydrocarbon hydroxylase activity and increased responsiveness of the aryl hydrocarbon hydroxylase induction mechanism to 2,3,7,8-tetrachlorodibenzo-p-dioxin (TCDD). Cell fusion experiments indicate that the variant phenotype is co-dominant with respect to wild-type. Filter hybridization analyses indicate that increased accumulation of cytochrome P1-450-specific mRNA accounts for the overproduction of aryl hydrocarbon hydroxylase activity. Measurements of RNA synthesis in isolated nuclei reveal that the variants exhibit an increased rate of transcription of the cytochrome P1-450 gene in response to TCDD. The variant cells contain no detectable alteration in their TCDD receptors, nor is the cytochrome P1-450 gene amplified in the variants. Filter hybridization analyses of restriction endonuclease-digested DNA indicate that the variant cytochrome P1-450 gene is relatively undermethylated, compared with the wild-type gene. We conclude that the variant cells contain an altered cis-acting genomic element(s) which regulates the expression of the cytochrome P1-450 gene.