Granulosa cells in the chicken follicle exhibit different phenotypes according to their location relative to the germinal disc (GD). Granulosa cells proximal to the GD (referred to as proximal granulosa cells) are more proliferative, whereas granulosa cells distal to the GD (referred to as distal granulosa cells) are more differentiated. We have shown that epidermal growth factor (EGF) derived from the GD stimulated proliferation of granulosa cells proximal to the GD, whereas extraovarian LH promoted differentiation. We tested the hypothesis that phenotypic differences of granulosa cells are the result of differential responsiveness of granulosa cells to EGF and LH. We found that both granulosa and theca layers of chicken preovulatory follicles expressed mRNA for EGF receptor (EGFr) by polymerase chain reaction (PCR) analysis. However, only the granulosa layer showed differential expression of EGFr and LH receptor (LHr) mRNA. Competitive reverse transcription-PCR revealed that proximal granulosa cells expressed more EGFr mRNA but less LHr mRNA than distal granulosa cells. In addition, proximal granulosa cells proliferated more in response to EGF than their distal counterparts. We further demonstrated that EGF decreased LHr mRNA expression by granulosa cells in a dose-dependent manner, whereas EGF and LH had no effect on EGFr mRNA expression except at one dose of LH (15 ng/ml) that stimulated EGFr mRNA expression. Our findings suggest that EGF derived from the GD influences the phenotypes of granulosa cells. Granulosa cells proximal to the GD exhibit a proliferative phenotype possibly because they are exposed to and are more responsive to GD-derived EGF. Furthermore, GD-derived EGF decreases LHr mRNA expression by proximal granulosa cells and therefore results in less differentiated granulosa cell phenotype. In contrast, granulosa cells distal to the GD are not under the influence of EGF and exhibit a more differentiated phenotype.