Aberrant expression of the Evi1 (ecotropic virus integration site 1) proto-oncogene has been associated with hematopoietic malignancies in both mice and man. To determine the effect of enforced expression of Evi1 in vivo, we developed a transgenic mouse model utilizing the murine Sca-1 (Ly-6E. 1) promoter. Here, we describe the generation and analysis of three independent lines of Evi1 transgenic mice. Transgenic animals of two founder lines developed normally. These mice did not show any obvious hematological abnormalities but showed a significant reduction in the number of bone marrow colony-forming unit erythroid (CFU-E)-derived colonies. This implies a defect of normal erythroid hematopoiesis affecting relatively late erythroid progenitor cells. We also show that when newborn Evi1 transgenic mice of these two lines were infected with Cas-Br-M MuLV, tumor incidence was greatly enhanced in comparison with nontransgenic littermates, indicating an increased susceptibility for leukemia development. Interestingly, analysis of a third founder line revealed that all male progeny consistently displayed severely impaired erythropoiesis with major defects in the bone marrow, spleen and peripheral blood. Taken together, our results present the first evidence of Evi1 disturbing normal erythropoiesis in vivo and provides evidence for cooperative potential of Evi1 in tumor progression.