Avian erythroblastosis virus (AEV) is an acutely transforming retrovirus whose putative oncogenes (v-erb-A and v-erb-B) encode the proteins P74gag-erb-A and P61-68erb-B. The existence of these two gene products has prompted the question of whether one or both proteins are required in the transformation of erythroblasts and fibroblasts by AEV. In the accompanying manuscript, we describe the use of site-specific mutagenesis to generate mutants of AEV unable to synthesize P61-68erb-B. Here we present our analysis of the oncogenic potential of an AEV mutant unable to synthesize P74gag-erb-A due to a large deletion encompassing both gag and v-erb-A sequences. The erb-A-mutant retrovirus propagated quite poorly on fibroblasts in culture; however, fibroblasts harboring the erb-A mutant genome were transformed in the absence of P74gag-erb-A expression. The mutant virus failed to induce erythroleukemias in chickens, but the validity of this finding is compromised by the poor replicative capacity of the mutant. The results presented in this and the preceding manuscript indicate that P61-68erb-B is both necessary and sufficient for neoplastic transformation of fibroblasts by AEV; by contrast, a role for p74gag-erb-A in leukemogenesis by AEV has not yet been rigorously excluded.