Sarcoma growth factor (SGF) derived from conditioned medium of Moloney sarcoma virus-transformed cells and partially purified by gel filtration (crude SGF) has been characterized by its ability both to compete with epidermal growth factor (EGF) for binding to membrane receptors and to induce anchorage-independent growth of untransformed cells. We now show that further purification of crude SGF by reverse-phase HPLC on muBondapak C18 and CN columns at pH 2 resolves it into two distinctly different polypeptides, which we call types alpha and beta transforming growth factors (TGFs). Type alpha TGF (TGF-alpha), but not type beta TGF (TGF-beta), competes for binding to the EGF receptor and induces the formation of small colonies (1,000-2,000 micron2) of normal rat kidney cells in soft agar. Both TGF-beta and EGF or TGF-alpha must be present in order to induce the formation of large colonies (7,000-15,000 micron2). Based on EGF competing equivalents as determined from a radioreceptor assay with 125I-labeled EGF in normal rat kidney cells, the relative ability of EGF and TGF-alpha to potentiate TGF-beta-dependent colony formation is in the order conditioned-medium TGF-alpha greater than EGF greater than intracellular TGF-alpha. Suboptimal concentrations of the same polypeptides give additive potentiation of the TGF-beta-dependent colony-forming response; saturating levels potentiate a similar maximum response whether used alone or in various combinations. The data indicate that the EGF-competing activity of crude SGF is due to its TGF-alpha component alone, whereas the soft-agar colony-forming activity is due to the combined action of two distinct polypeptides, TGF-alpha and TGF-beta.