Abnormal expression of c-fms proto-oncogene, which encodes for the macrophage colony-stimulating factor-1 (CSF-1) receptor, has been observed in a variety of carcinomas of epithelial origin, including those of the breast. Here, we have investigated the effect of retinoic acid (RA), an important regulator of normal differentiation of mammary epithelial tissues, on the expression of the c-fms gene and CSF-1/CSF-1 receptor-induced invasion and anchorage-independent growth in breast carcinoma cells. We have demonstrated that all-trans-RA (atRA) significantly increases levels of c-fms transcripts in the estrogen receptor-negative but RA receptor alpha-positive breast carcinoma cell lines BT20 and SKBR3. The atRA-induced increase in fms transcript levels was completely abolished by RO41-5253, a synthetic RA receptor alpha antagonist. Our results indicate that atRA could enhance fms expression by up-regulating the activity of the first promoter of the fms gene. DNase I protection, mobility shift, and mutational analysis revealed that a potential activator protein 1 (AP-1) site in the first fms promoter sequence could mediate the observed atRA effect on fms transcription. Our results also showed that atRA, by itself and in the presence of CSF-1, can increase the ability of breast carcinoma cells to invade in vitro. Furthermore, we demonstrated that atRA is able to abolish the CSF-1-induced increase in anchorage-independent growth of breast carcinoma cells without affecting the anchorage-dependent growth. In summary, our findings suggest that retinoids may play conflicting roles throughout breast cancer progression, depending on the stage of cancer development. Although retinoids might suppress growth at the early stages of tumor formation, they might promote malignant transformation at later stages by stimulating the invasive capacity of certain cell variants in the breast tumor population.