Retrovirus-mediated gene transfer was used to obtain expression of the macrophage colony-stimulating factor (MCSF) receptor, c-fms, on hematopoietic lineages that normally do not express this receptor. Cultures of murine fetal liver cells infected with the c-fms retrovirus developed erythroid colonies in cultures stimulated with M-CSF. However, these colonies were fewer and less hemoglobinized than colonies in parallel cultures stimulated by erythropoietin. Culture of isolated clones demonstrated a direct action of M-CSF on erythroid clones. Culture of c-fms retrovirus-infected adult murine bone marrow cells showed megakaryocyte and novel macrophage-megakaryocyte clones when stimulated by M-CSF. Culture of isolated clones again confirmed a direct action of M-CSF on megakaryocyte clones. In contrast, M-CSF stimulation of c-fms-infected granulocytes and granulocyte progenitor cells did not elicit proliferation, enhanced survival, or functional stimulation of granulocytes. These findings provide evidence for both conservation and lineage restriction of signal transduction in normal hematopoietic cells.