The effect of overexpression of p21^waf1 on drug sensitivity was studied in an osteosarcoma cell line (SaOs-2) lacking both p53 and functional retinoblastoma protein using a tetracycline (TC)-inducible expression system. p21^waf1 expression was barely detectable in SaOS-2 cells incubated in the presence of TC. After TC withdrawal, high levels of p21^waf1 were induced in these cells. These p21^waf1-induced cells showed increased sensitivity to doxorubicin, tomudex, and methotrexate as compared to uninduced cells; this condition is associated with increased apoptosis. Expression of p21^waf1 reduced cyclin A-associated kinase activity and, surprisingly, resulted in inhibition of phosphorylation of E2F-1 and increased E2F-1 binding activity. An S-G₂ cell cycle arrest/delay and an increase in expression of E2F-responsive genes (dihydrofolate reductase and thymidylate synthase) was correspondingly observed. Overexpression of p21^waf1 in cells lacking functional retinoblastoma protein may mediate sensitivity to anticancer drugs by inhibiting E2F-1 phosphorylation, which may contribute to increased S-G₂ cell cycle delay and increased cell susceptibility to apoptosis.