We describe a propagable cell strain from guinea pig gastric circular muscle (GCM), which we have characterized in terms of its smooth muscle phenotype and its binding and biological response (thymidine incorporation) to epidermal growth factor-urogastrone (EGF-URO) and transforming growth factor-alpha (TGF-alpha). The binding of 125I-labeled EGF-URO to the GCM cells exhibited high affinity and an appropriate peptide specificity. A curvilinear Scatchard plot of the binding data indicated two classes of high-affinity binding sites (dissociation constants of 0.69 and 4.3 nM) and a maximal binding capacity of 24,000 sites/cell. Binding competition data demonstrated that the binding affinity of TGF-alpha was greater than that of EGF-URO by a factor of 2. These relative binding affinities agreed with the two- to threefold greater potency of TGF-alpha, compared with EGF-URO, for the stimulation of GCM thymidine incorporation. The relative order of binding affinity and biological potency (TGF-alpha greater than EGF-URO) was distinct from the relative order of binding affinities (EGF-URO greater than TGF-alpha) observed using guinea pig liver and human placental membrane preparations. We conclude that the cultured smooth muscle-derived GCM cells possess a receptor subtype that is in accord with contractile bioassay data obtained previously with intact gastric circular muscle strips. This receptor (TGF-alpha greater than EGF-URO) appears distinct from the one previously characterized in nonmuscle tissues.