THE adenovirus oncoprotein E1A and the simian virus SV40 large T antigen can both reverse the strong growth-inhibitory effect of transforming growth factor(TGF)-beta on mink lung epithelial cells(1,2) : exposure of TGF-beta causes these cells to arrest late in the G1 phase of the cell cycle (ref. 3). This arrest correlates with an increase in expression of the protein p15(Ink4B) (ref. 4), inactivation of the cyclin E/A-cdk2 complex by the inhibitory protein p27(Kip1) (refs 5-7), and with the accumulation of unphosphorylated retinoblastoma protein(8). The rescue by E1A of cells from TGF-beta arrest is partly independent of its binding to retinoblastoma protein(1). Here we show that E1A directly affects the cyclin-dependent kinase inhibitor p27(Kip1) in TGF-beta-treated cells by binding to it and blocking its inhibitory effect, thereby restoring the activity of the cyclin-cdk2 kinase complex. In this way, E1A can overcome the effect of TGF-beta and modulate the cell cycle. To our knowledge, E1A provides the first example of a viral oncoprotein that can disable a cellular protein whose function is to inhibit the activity of cyclin-dependent kinases.