Somatic gene transfer is a promising therapeutic strategy, but it may also evoke new types of side effects related to genetic damage or transgene activity. Retroviral vectors, the best tool currently available for stable genetic modification, integrate at random positions in the cellular genome. The risk of mutagenesis of cellular sequences promoting a malignant phenotype is about 10 7 per insertion (1). As tumor development requires further genetic lesions, a single copy of an otherwise innocuous transgene is not expected to produce severe side effects. Nevertheless, we observed leukemia induction in an animal model of retroviral gene marking. Using a replication-defective vector (2), we introduced the clinically used dLNGFR marker gene (3) into murine bone marrow (BM) cells before transplantation into irradiated [10 grays (Gy)] C57Bl/6J mice (n 5). No hematopoietic alterations were observed within 28 weeks. Pooled BM cells were transplanted into secondary irradiated (10 Gy) recipients (n 10). All 10 developed hematopoietic disorders within 22 weeks. One animal showed extramedullary hematopoiesis with islands of blasts, three had preleukemia with reduction of splenic white pulp and elevated blast counts, and six succumbed to overt acute myeloid leukemia (AML) analogous to human AML M5 phenotype (monocytoid). Sublethally irradiated (7.5 Gy) tertiary recipients (n 8) developed lethal AML M5 within 4 months. Vectors encoding other marker proteins did not lead to a similar disease in control animals (n 70). Further controls excluded transgene sequence alterations, the presence of replicating retroviruses, or activation of endogenous retroviral sequences.