Erythropoietin (Epo) affects not only erythrocyte production but, in vitro, also promotes megakaryocyte maturation. However, the mechanism of action of Epo on megakaryocytic development remains to be determined. Recently, we reported the establishment of a human Epo-dependent megakaryoblastic leukemic cell line UT-7. Exposure of UT-7 to the tumor promoter, phorbol myristate acetate (PMA), resulted in the appearance of mature megakaryocytic properties, including the expression of platelet factor 4 and beta-thromboglobulin. With exposure to PMA, however, UT-7 cells lost their responsiveness to Epo and Scatchard analysis showed an 85% decrease in the number of Epo receptors after 24 h. While the number of binding sites declined, the affinity of Epo binding was unchanged. Associated with the decline in the number of Epo receptors was a profound decrease (> 95%) in the level of Epo receptor (Epo-R) mRNA. To determine the level of regulation of the Epo-R gene, its rate of transcription was measured by nuclear run-off assay in untreated cells and in cells exposed to PMA for 6, 12, and 24 h. The rate of transcription was nearly identical at all time points in control and PMA-treated cells. Stability of Epo-R mRNA also was measured in the presence of actinomycin D, an inhibitor of transcription. The half-life of Epo-R mRNA in untreated and PMA-treated cells was 90 and 30 min, respectively. These results indicate that the down-modulation of the expression of the Epo-R gene is mainly caused by increased instability of mature mRNA of Epo-R. Posttranscriptional regulation may be an important mechanism in the regulation of hematopoietic growth factor receptor genes and one of the mechanisms by which lineage restriction is achieved.