Classical cytotoxic treatment of rhabdomyosarcoma (RMS) is accompanied often by significant morbidity and poor response. The use of cytotoxic agents may induce a multidrug resistance phenotype, which plays an important role in the sensitivity of tumoral cells to drugs. Using actinomycin D, a drug of choice in the treatment of RMS, we induced resistance in the TE.32.7 human RMS cell line. The TE.32.7-DAC-resistant cell line exhibited cross-resistance to vincristine and doxorubicin and showed mdr1/P-glycoprotein over-expression, suggesting that this mechanism was involved in the reduction in intracellular drug concentration and may be responsible for the failure of treatment of RMS with classical cycles of cytotoxics. Furthermore, this resistant cell line showed increased expression of the muscle differentiation markers desmin and α-actinin and ultrastructural changes which clearly indicated myogenic differentiation. Our findings suggest that, although this tumor is probably arrested along the normal myogenic pathway to maturation, induction of cell differentiation with anti-neoplastic drugs may be an alternative therapeutic approach. However, the failure of TE.32.7-DAC cells to completely re-enter the program of myogenic differentiation supports the hypothesis that multidrug resistance is a major obstacle in differentiation therapy for RMS. Int. J. Cancer 75:379–383, 1998. © 1998 Wiley-Liss, Inc.