Stimulation of epidermal growth factor (EGF) receptor by ligands such as transforming growth factor (TGF) alpha may be associated with cell proliferation or transformation in both nevocytes and keratinocytes. Previously, EGF receptors have been identified within a variety of pigmented lesions, suggesting a possible responsiveness to ligands such as TGF alpha. In the present study, we characterize the intralesional expression and distribution of immunoreactive TGF alpha protein by avidin-biotin immunoperoxidase localization in benign nevi, congenital nevi, dysplastic nevi, and malignant melanomas. In situ hybridization techniques with TGF alpha riboprobes confirmed the constitutive production of TGF alpha in all types of pigmented lesions. The localization of TGF alpha expression to nevocytes when coupled with the previous reports of expression in basal keratinocytes suggests the possibility of either an autocrine mechanism of action for TGF alpha or a paracrine interplay of TGF alpha between keratinocytes and nevocytes within melanocytic lesions. An increase in immunoreactive TGF alpha in nevocytes was noted in both benign and dysplastic nevi from dysplastic nevus patients, as compared to benign nevi from normal patients. Congenital nevi and malignant melanomas showed an intermediate and variable level of TGF alpha immunoreactivity. When coupled with previous studies the data suggest linkage of the TGF alpha/EGF receptor pathway in the evolution of melanocytic lesions.