Medullary thyroid carcinoma (MTC) is an endocrine tumor of the thyroid C cells that expresses high levels of the neuroendocrine peptide hormone calcitonin. During tumor progression in the host, there is an apparent loss of differentiation in MTC cells that involves a consistent decrease in calcitonin content of the tumor cells associated with decreased expression of the calcitonin gene and/or changes in a mRNA alternative-processing pattern away from that characteristic of the parent thyroid C cell. We now report that introduction of the viral Harvey ras (v-Ha-ras) oncogene into cultured human MTC cells can reverse such changes in gene expression and can induce endocrine differentiation of the tumor cells. The expression of v-Ha-ras is associated with decreased cellular proliferation and DNA synthesis. There is a marked increase in the number of cytoplasmic secretory granules that are a classic feature of differentiated thyroid C cells. v-Ha-ras expression induces increased expression of the calcitonin gene and the processing of the primary gene transcript is shifted to favor calcitonin mRNA rather than calcitonin-gene-related peptide (CGRP) mRNA production. These studies with cultured human MTC cells provide a model system to study the role of Ha-ras and related genes in neuroendocrine differentiation. The findings suggest an important approach for identifying genes in solid tumors whose altered expression may play a role in the impaired maturational capacity characteristic of cancer cells during tumor progression.