All-trans retinoic acid (tRA), a naturally occurring ligand of the nuclear retinoic acid receptors (RARs), induces differentiation of leukemic cells and clinical complete remission in patients with acute promyelocytic leukemia (APL). This differentiation effect can also be seen in vitro in both fresh leukemic cells and in the unique permanent APL cell line, NB4. However, APL cells become resistant to RA-induced differentiation both in vitro and in patients. Although pharmacodynamic mechanisms of resistance have been reported, there is growing evidence that resistance both in patients, as well as in vitro, can be mediated by changes in the sensitivity of leukemic cells to retinoids. To investigate possible mechanisms of retinoid resistance, we established subclones of NB4 that are stably resistant to both tRA and 9-cisRA. Unlike the previously reported NB4.306 retinoid-resistant cells, these subclones expressed PML/RAR-alpha RNA and protein, but demonstrated altered ligand binding patterns of PML/RAR-alpha and differed in retinoid-induced gene expression. They were significantly less able to stimulate transcription of an RARE driven CAT-reporter gene on induction by tRA and showed altered DNA binding activity on a RARE. These data suggest that NB4 cells selected for resistance to retinoids demonstrate abnormal ligand binding to PML/RAR-alpha that lead to altered transcriptional activation by retinoids.