Overexpression of c-raf-1 and the myc family of protooncogenes is primarily associated with small cell carcinoma, which accounts for approximately 25% of human lung cancer. To determine the functional significance of the c-raf-1 and/or c-myc gene expression in lung carcinogenesis and to delineate the relationship between protooncogene expression and tumor phenotype, we introduced both protooncogenes, alone or in combination, into human bronchial epithelial cells. Two retroviral recombinants, pZip-raf and pZip-myc, containing the complete coding sequences of the human c-raf-1 and murine c-myc genes, respectively, were constructed and transfected into simian virus 40 large tumor antigen-immortalized bronchial epithelial cells (BEAS-2B); this was followed by selection for G418 resistance. BEAS-2B cells expressing both the transfected c-raf-1 and c-myc sequences formed large cell carcinomas in athymic nude mice with a latency of 4-21 weeks, whereas either pZip-raf- or pZip-myc-transfected cells were nontumorigenic after 12 months. Cell lines established from tumors (designated RMT) revealed the presence of the cotransfected c-raf-1 and c-myc sequences and expressed morphological, chromosomal, and isoenzyme markers, which identified BEAS-2B cells as the progenitor line of the tumors. A significant increase in the mRNA levels of neuron-specific enolase was detected in BEAS-2B cells containing both the c-raf-1 and c-myc genes and derived tumor cell lines. The data demonstrate that the concomitant expression of the c-raf and c-myc protooncogenes causes neoplastic transformation of human bronchial epithelial cells resulting in large cell carcinomas with certain neuroendocrine markers. The presented model system should be useful in studies of molecular events involved in multistage lung carcinogenesis.