Recently, we have reported that 3-hydrogenkwadaphnin (3-HK), a diterpene ester isolated from Dendrostellera lessertii (Thymealeaceae), is very effective against leukemia cell lines without any detectable effects on normal cells (Moosavi et al., 2005b). In this study, we report that 3-HK induces $G_1$ cell-cycle arrest, differentiation and apoptosis in APL NB4 cell line. Indeed, the drug between 24 to 96 h induced 7-65% growth inhibition of NB4 cells. Cell viability was also decreased by 2-55% between 24 to 96 h treatments with the drug, respectively. These effects of the drug were also dose-dependent. According to flow cytomtry results, 3-HK (15 nM) induced a significant G1-arrest up to 24 h which was consequently followed with appearance of sub-$G_1$ peak at 72 to 96 h. Hoechst 33258 staining and DNA fragmentation assays confirmed the occurrence of apoptosis among the treated cells. On the other hand, NBT reducing assay, Wright-Giemsa staining, phagocytic activity and expression of cell surface markers (CD11b and CD14) confirmed that the inhibition of proliferation is associated with differentiation especially toward macrophage-like morphology. Interestingly, 3-HK at 5 and 10 nM enhanced the effects of all-trans retinoic acid (ATRA) in NB4 cells. Based on these results, 3-HK might become an ideal candidate for treatment of APL patients pending full exploration of its biological functions.