The basement membrane (BM) extracellular matrix induces differentiation and suppresses apoptosis in mammary epithelial cells, whereas cells lacking BM lose their differentiated phenotype and undergo apoptosis. Addition of purified BM components, which are known to induce beta-casein expression, did not prevent apoptosis, indicating that a more complex BM was necessary. A comparison of culture conditions where apoptosis would or would not occur allowed us to relate inhibition of apoptosis to a complete withdrawal from the cell cycle, which was observed only when cells acquired a three-dimensional alveolar structure in response to BM. In the absence of this morphology, both the GI cyclin kinase inhibitor p21/WAF-1 and positive proliferative signals including c-myc and cyclin DI were expressed and the retinoblastoma protein (Rb) continued to be hyperphosphorylated. When we overexpressed either c-myc in quiescent cells or p21 when cells were still cycling, apoptosis was induced. In the absence of three-dimensional alveolar structures, mammary epithelial cells secrete a number of factors including transforming growth factor alpha and tenascin, which when added exogenously to quiescent cells induced expression of c-myc and interleukin-beta1-converting enzyme (ICE) mRNA and led to apoptosis. These experiments demonstrate that a correct tissue architecture is crucial for long-range homeostasis, suppression of apoptosis, and maintenance of differentiated phenotype.