The ability to modulate granulocyte-macrophage colony-forming unit (CFU- GM) Ia-antigen expression and response to growth inhibition in vitro was investigated in normals and patients with chronic myeloid leukemia (CML). The hyporesponsiveness of CML CFU-GM to inhibition by prostaglandin E and acidic isoferritins in vitro and their associated diminished capacity for Ia-antigen expression could be reversed following suspension culture of bone marrow cells in the presence of prostaglandin E prior to soft agar culture. Suspension preculture with prostaglandin E for 24 hr resulted in the detection of a population of CFU-GM that were equivalent to normal CFU-GM in both response to inhibition by prostaglandin E and acid isoferritins and in their pattern of Ia-antigen expression. Cytogenetic analysis of the progeny of CFU-GM proliferating in cultures established from marrow cells, cultured directly upon isolation or following suspension culture in the absence or presence of prostaglandin E for 24 hr, indicated that the responding cell population belonged to the Ph1-positive leukemic clone. Antigen detection on these CFU-GM resulted both from Ia-antigen reexpression and the induction of noncycling cells into S-phase with coincident expression of Ia-antigens. These studies provide further evidence for a direct regulatory association between Ia-antigen and control of granulocyte-macrophage progenitor cell proliferation, offer a possible explanation for the disordered regulatory responses observed in patients with CML, and indicate that abnormal growth phenotypes can be modulated, at least in vitro.