Metabolites of arachidonic acid and linoleic acid can serve as regulators of the epidermal growth factor signal transduction system in Syrian hamster embryo (SHE) fibroblasts. We have now investigated the possible role of these lipids in modulating the signal transduction of basic fibroblast growth factor (bFGF), a potent mitogen to SHE fibroblasts. The addition of bFGF (0.1 to 1.0 ng/ml) to serum-deprived SHE cells stimulated a six- to sevenfold increase in the incorporation of thymidine into DNA. Structural analysis indicated that bFGF stimulated the metabolism of exogenous and endogenous arachidonic acid to primarily PGE2, PGF2 alpha, and PGD2, with lesser amounts of uncharacterized prostaglandins observed. The metabolism of linoleic acid in SHE cells was not affected by bFGF. bFGF stimulated the expression of the inducible form of prostaglandin H synthase (PGHS-2) as determined by Northern analysis using murine PGHS-2 cDNA as the probe. PGHS-2 protein in the SHE cells was also increased by bFGF as determined by Western analysis using antibodies specific for PGHS-2. Levels of the constitutive (PGHS-1) enzyme and mRNA were not altered by bFGF. Preincubation of the cells with 1-2 microM dexamethasone significantly inhibited bFGF-stimulated expression of PGHS-2 protein and mRNA. Dexamethasone potently inhibited bFGF induced mitogenesis in these cells. Pretreatment of SHE cells with indomethacin inhibited bFGF-dependent mitogenesis, as well as endogenously produced PGE2. The data suggests that regulation of PGHS-2 expression may be an element of the bFGF mitogenic signal transduction pathway.