The t (l; 19) chromosomal translocation in acute lymphoblastic leukemias creates chimeric E2a-Pbxl oncoproteins that can act as DNA-binding activators of transcription. A structural analysis of the functional domains of E2a-Pbxl showed that portions of both E2a and Pbxl were essential for transformation of NIH 3T3 cells and transcriptional activation of synthetic reporter genes containing PBX1 consensus binding sites. Hyperexpression of wild-type or experimentally truncated Pbx1 proteins was insufficient for transformation, consistent with their inability to activate transcription. When fused with E2a, the Pbx-related proteins Pbx2 and Pbx3 were also transformation competent, demonstrating that all known members of this highly similar subfamily of homeodomain proteins have latent oncogenic potential. The oncogenic contributions of E2a to the chimeras were localized to transactivation motifs AD1 and AD2, as their mutation significantly impaired transformation. Either the homeodomain or Pbx1 amino acids flanking this region could mediate transformation when fused to E2a. However, the homeodomain was not essential for transformation, since a mutant E2a-Pbxl protein (E2a-Pbx ΔHD) lacking the homeodomain efficiently transformed fibroblasts and induced malignant lymphomas in transgenic mice. Thus, transformation mediated by the chimeric oncoprotein E2a-Pbx1 is absolutely dependent on motifs acquired from E2a but the Pbx1 homeodomain is optional. The latter finding suggests that E2a-Pbx1 may interact with cellular proteins that assist or mediate alterations in gene expression responsible for oncogenesis even in the absence of homeodomain-DNA interactions.