Abstract The NIH 3T3 line of cells has particular advantages for studying the dynamics of change in cellular phenotype in response to environmental conditions. Similar to stem cell growth during development, the cell line changes its phenotype under growth constraints that elicit differentiation or, alternatively, it maintains its original state over many replication cycles when grown without constraint. Unlike many cell types which respond by undergoing terminal differentiation, the NIH 3T3 cells continue to multiply indefinitely following an induced alteration in phenotype; the heritability of this change may thus be analyzed under stringent conditions of cell culture. During the course of over two years of frequent passage at low density in high calf serum (CS) concentration, a new subline developed which exhibited a consistent capacity to respond quickly and pervasively to growth constraints with an increase in saturation density, development of transformed foci in confluent cultures and altered appearance of isolated colonies. A retrospective study was undertaken, with cells from cryopreserved samples, of the course of changes in responsiveness of the cells to growth constraint leading up to the highly responsive state. Three stages were discerned, the first with an initially high capacity of a small fraction of cells to produce diffuse foci, but with a rapid decline in this capacity with frequent low density passages; the second stage, extending over more than 200 passages, of refractoriness to transformation; and the third stage (which probably arose by mutation) in which there is a consistent transformation-related response by the entire population to growth constraint, a response which has remained relatively constant over some 100 passages. A striking and novel feature of the third stage is seen on cloning the cells. Almost all the colonies obtained by cloning cells from post-confluent, growth-inhibited cultures are distinctly different in morphology from those obtained by cloning cells from the frequent low density passages. The pervasiveness of this morphological change among the clones is unmistakable evidence for a heritable adaptive response to growth constraint by most if not all of the cells in the population. The population-wide response of the cells of the third stage offers the opportunity for a rigorous, quantitative analysis of the nature of this type of persistent cellular change. Although cells of the third stage may be of mutational origin, their pervasive heritable response once the variant population is established supports the concept of progressive state selection which postulates that transformation can arise by the continuous fluctuation of growth states within cells, accompanied by the progressive selection of those states best suited to function under the selecting constraint. Relevance of the concept to the process of differentiation under growth constraint is considered.