Although a replication-competent retrovirus that carries junD has no transforming activity in chicken embryo fibroblasts, we have isolated mutant viruses that have spontaneously acquired transforming activity. The molecularly cloned junD genes of three such mutant viruses (T1, T2, and T3) were shown to be responsible for the cellular transformation. DNA sequence analysis indicated that a specific polynucleotide in the junD sequence was tandemly multiplied three times of five times in T1 and T2, respectively. The repeated polynucleotide encodes 16 amino acid residues that are located in a highly conserved region among Jun family proteins. The junD mutation in T3 involved an inversion, a translocation, and nucleotide substitutions that caused drastic amino acid exchanges in another well-conserved region among Jun family proteins. The transcriptional activity of these mutants was analyzed by means of transient expression experiments in F9 cells using a reporter gene containing a single AP-1 binding site. Compared with the wild-type JunD, none of them showed enhanced transactivating activity in the forms of homodimers or of heterodimers with c-Fos or Fra-1. However, they did exhibit much higher transactivating activity than the wild type when they formed heterodimers with Fra-2, indicating that the mutated regions function as transactivation domains in a partner-specific manner. Since we have previously reported that there is a basal level of Fra-2 expression in chicken embryo fibroblasts, the results may indicate that protein complexes between JunD mutants and Fra-2 play a crucial role in the cellular transforming activity.