To analyze the effect of human T-cell leukemia virus type I (HTLV-I) on cellular gene expression and its relation to tumorigenesis, two lines of transgenic mice carrying the long terminal repeat (LTR)-env-pX-LTR regions of the HTLV-I genome were produced. The transgene was expressed in many organs, including the brain, salivary gland, spleen, thymus, skin, muscle, and mammary gland. We found that the expression of the c-fos and c-jun genes, but not of the lyn and c-myc genes, was augmented 2- to 20-fold in histologically normal skin and muscle of these mice. The augmentation was tissue specific, suggesting the involvement of a cellular factor in the transgene action. In these mice, a three to seven times higher incidence of tumors was seen as compared with the control mice. These tumors included mesenchymal tumors, such as fibrosarcoma, neurofibroma, and lipoma, and adenocarcinomas of the mammary gland, salivary gland, and lung. The c-fos and c-jun genes were also activated in these tumors. The possible roles of elevated c-fos and c-jun gene expression in tumorigensis are discussed. © 1994 Kluwer Academic Publishers.