Cellular proliferation is a dominant aspect of ovarian follicular development in the rat, and insulin-like growth factor I (IGF-I) has been proposed as a mediator of cellular growth and differentiation in the ovary. An SV40-transformed rat granulosa cell line (RGA-41S) has been established as a model for studies on dividing cells of granulosa origin. Granulosa cells from the ovaries of immature diethylstil-bestrol-treated rats were infected with the tsA255 mutant of SV40, followed by cloning in serum-free medium to select transformed cell lines which were serum independent. At the permissive temperature (33 C), RGA-41S cells exhibited a transformed phenotype and rapidly formed high density multilayers of compact cells that readily overgrew nontrans-formed cells. At the nonpermissive temperature (40 C) cell replication declined and division ceased after 4 days. Furthermore, at 40 C the cells grew as a monolayer and assumed a tetrahedral shape with a high cytoplasm-to-nucleus ratio, and displayed reduced ability to overgrow nontransformed cells. The transformed ovarian cells did not express detectable gonadotropin receptors and steroidogenic activity but retained their epithelial phenotype as demonstrated by cytokeratin staining of the cytoskele-ton, the presence of microvilli, and the formation of tight junctions between cells. In support of the proposed autocrine-paracrine actions of IGF-I in the ovary, assay of conditioned serum-free culture medium revealed secretion of IGF-l-immunoreactive material by RGA-41S cells. HPLC-purified IGF-I im-munoreactivity from these cells eluted with the same retention time as recombinant human IGF-I. When hybridized with a32P-labeled rat IGF-I cDNA probe, poly(A)+ mRNA prepared from RGA-41S cells grown at both temperatures showed the typical three size classes of IGF-I mRNA on Northern blots (7.5, 1.7, and 0.8-1.2 kilobase kb), although the levels were somewhat higher at 33 C. The presence of IGF-I receptors in transformed cells was demonstrated by specific125I-IGF-I binding to intact cells. Scatchard analysis indicated a single class of high affinity receptors at a density of 105 binding sites per cell and a dissociation constant (Kd) = 0.52 × 10-9 M. Furthermore, hybridization of a32P-labeled IGF-I receptor probe to Northern blots of poly(A+) RNA prepared from cells grown at 33 C and 40 C revealed an 11-kilobase rat IGF-I receptor mRNA. Physiological concentrations of IGF-I increased [3H]aminoisobutyric acid uptake by RGA-41S cells grown at either temperature, attesting to the retention of responsiveness to IGF-I in these transformed granulose cells. This rat ovarian cell line offers a unique model for studying the roles of IGF-I and its homologous receptor, as well as the expression of the corresponding genes, in the autocrine-paracrine actions of IGF-I on the regulation of granulosa cell division and proliferation in the ovary.