Hormonal induction of growth-arrested 3T3-L1 preadipocytes in medium containing fetal bovine serum (FBS) triggers a signaling cascade that culminates in adipogenesis. The transcription factor, C/EBP beta, is expressed early in this differentiation program, but lacks DNA-binding activity until much later as the preadipocytes traverse the G(1)-S checkpoint of mitotic clonal expansion. Dominant-negative CHOP-10 is initially expressed by growth-arrested preadipocytes and sequesters/inactivates C/EBP beta by heterodimerization with its leucine zipper. After a lag period, CHOP-10 undergoes down-regulation releasing C/EBP beta from inhibitory constraint allowing transactivation of the C/EBP alpha and PPAR gamma genes, transcription factors required for terminal differentiation. We verify that following induction of differentiation in FBS-containing medium, CHOP-10 undergoes down-regulation and differentiation occurs normally. However, when differentiation is induced in calf serum-containing medium, CHOP-10 is not down-regulated resulting in delayed and incomplete differentiation. Under these conditions the expression of C/EBP alpha and PPAR gamma and the accumulation of cytoplasmic triglyceride are attenuated. It appears that a factor(s) present in FBS is required to affect the down-regulation of CHOP-10 necessary for successful terminal differentiation. (c) 2005 Elsevier Inc. All rights reserved.