A human round cell line, KLM-2, is considered to be precursor B-cell by immunologic surface marker analysis and histochemical studies. The effect of 12-O-tetradecanoyl phorbol-13-acetate (TPA) and/or colony- stimulating factor (CSF) on KLM-2 cells was investigated. KLM-2 cells became adherent to the bottom of the flask on day 2 after liquid culture with TPA, and the number of macrophage-like adherent cells (mAC) with pseudopodia showed a TPA dose-dependent increase to the peak level on day 3 or 4. The mAC had a phagocytic activity. The suspending cells were positive for alpha-naphthyl acetate esterase (NAE) up to about 50% in culture with TPA. A TPA concentration of 100 ng/ml was optimal to provide a maximum number of mAC and NAE-positive suspending cells. Particularly, such effects of TPA on KLM-2 cells were markedly accelerated in the presence of CSF. These findings indicate macrophage differentiation of KLM-2 cells in the presence of TPA and CSF. KLM-2 cells may be a bipotential stem cell line differentiating into B-cell and monocyte-macrophage lineages.