Chronic nicotine up-regulates the number of high affinity nicotinic acetylcholine receptors (nAChRs) in mammalian brain. Here, we studied up-regulation of the nAChR composed of alpha4 and beta2 subunits in the M10 cell line by using [3H]epibatidine to measure nAChR in cells in situ and in membrane preparations. Cultures were exposed to drugs for 2 days before assay. All agonists up-regulated [3H]epibatidine binding sites with EC50 values typically 10-100-fold higher than their respective Ki values from competition binding assays. Maximum up-regulation ranged from 40% to 250% above control values. Maximally effective concentrations of the less efficacious agonists methylcarbamylcholine or (+/-)-epibatidine together with nicotine resulted in less up-regulation than that produced by nicotine alone, showing that they are partial up-regulatory agonists. The antagonists dihydro-beta-erythroidine, methyllycaconitine, d-tubocurarine, hexamethonium, decamethonium, and mecamylamine either failed to up-regulate [3H]epibatidine binding sites or up-regulated mildly at high concentrations. When tested at non-up-regulating concentrations, only d-tubocurarine significantly inhibited agonist-induced up-regulation; this inhibition seemed to be noncompetitive. Comparison of [3H]epibatidine displacement in intact M10 cells and membrane preparations by membrane-impermeant ligands indicated that 85% of [3H]epibatidine binding sites are intracellular. On chronic treatment with agonist, the proportion of surface receptors did not change significantly, indicating that most up-regulated [3H]epibatidine binding sites are internal. However, up-regulation is mediated at the cell surface because the impermeant ligand tetramethylammonium was as efficacious as nicotine in eliciting up-regulation, and methylcarbamylcholine (i.e., impermeant but with low efficacy) blocked nicotine induced up-regulation. Thus, agonists elicit up-regulation (mainly of intracellular receptors) by interacting with cell surface nAChRs that are not compatible with either an active or high affinity desensitized conformation.