The cooperation of oncogenes in the transformation of primary rat Schwann cells is a strikingly synergistic process. We have explored the molecular mechanisms involved. Activation of an inducible Raf kinase results in morphologically transformed cells that are arrested in G1 via the induction of p21(CiP1) and subsequent inhibition of cyclin/cdk activity. In contrast, coexpression of SV40 large T (LT) or a dominant-negative mutant of p53 abolishes p21(CiP1) induction and alleviates the growth arrest. Moreover in this scenario, Raf activation results in an increase in the specific activity of cyclin/cdk complexes with Raf and LT cooperating to superinduce cyclin A/cdk2 activity and stimulate proliferation in the absence of mitogens. Thus, signaling by Raf and its cooperating partners converges at the regulation of cyclin/cdk complexes, with the cellular responses to Raf modulated by p53.