A severe immunodeficiency involving a complete loss of T lymphocytes and natural killer cells was observed in independent lines of transgenic mice containing > 30 copies of the human CD3E gene (pL12). T-cell- natural killer (NK)- mice could also be generated by using a gene fragment pL12 delta 1 (without exons 4A and 5) coding for the CD3-epsilon transmembrane region and its 55-amino acid nonenzymatic cytoplasmic tail. The abnormally small thymus gland in the homozygous transgenic animals, which was approximately 1% the size of a wild-type thymus, contained only a few (2-4%) prethymocytes with a Thy-1+Pgp-1+IL-2R alpha- CD3-4-8- phenotype. In mice with lower copy numbers of the transgene thymocyte development was blocked at the Thy-1+Pgp-1-IL-2R alpha+CD3-4-8- stage, and normal NK activity was detected. Mice generated with high-copy numbers of a transgene pL12 delta 2 (pL12 delta 1 minus exons 6), coding for a truncated protein from which the CD3-epsilon extracellular domain, its transmembrane region, and most of its cytoplasmic region were absent, contained normal numbers of T lymphocytes and NK cells. These transgene effects suggested that recruitment of signal-transduction molecules by the cytoplasmic tail of this protein played an important role in the abrogation of both lineages. Taken together these observations support the notion that T lymphocytes and NK cells stemmed from a common precursor.