An artificial membrane system was developed to study the molecular basis for interaction of pp6O-src, the Rous sarcoma virus transforming protein, with lipid bilayers. pp6o-src was extracted from cell membranes by detergent solubilization and reincorporated into phospholipid vesicles. Reconstituted pp6Ov-sF retained tyrosine kinase activity and was integrally associated with the liposome through a 10-kilodalton (kDa) amino-terminal domain. The same 10-kDa domain was shown to anchor pp60vsrc to the plasma membrane of transformed cells. Reconstitution experiments performed with nonmyristylated pp6ov-sc proteins revealed that these polypeptides did not interact with phospholipid vesicles. In contrast, myristylated, soluble pp6Ov-sc molecules (including a highly purified pp6ov-src preparation) could be reconstituted into liposomes, but their interaction with the liposomal bilayer was not mediated by the 10-kDa amino-terminal domain. When membrane proteins were included during reconstitution of purified pp6-src, binding through the 10-kDa anchor was restored. A model is presented to accommodate the different types of interactions of pp6Ov-src with liposomes; the model postulates the existence of an additional membrane component that anchors the pp60vsrc polypeptide to the phospholipid bilayer.Cellular transformation by Rous sarcoma virus (RSV) is mediated by expression of the viral src gene product, pp60v-src (21), a 60,000-dalton (Da) phosphoprotein which exhibits tyrosine-specific protein kinase activity (6,12,22). Cytological and biochemical studies have established that pp6Ov-src is predominantly membrane bound in transformed cells (14,24,25); the majority of the protein is associated with the plasma membrane, and a subpopulation is bound to intracellular membranes (32). Membrane attachment of pp6Ov-sr, is apparently essential for expression of tumorigenicity, since viruses encoding mutant src proteins which do not become membrane associated do not transform cells (16,23).The pathway for the biosynthesis of pp6ov-sr is different from that followed by many membrane-bound and secreted proteins. pp60-src is synthesized on free ribosomes (26) in soluble form (27), and the nascent polypeptide chain has no hydrophobic amino-terminal signal sequence (40). The primary sequence of pp6Ov-src contains neither long, uninterrupted stretches of hydrophobic amino acids (40) nor any potential sites for N-linked glycosylation (36). However, newly synthesized pp6Ov-src is rapidly posttranslationally modified by covalent addition of the 14-carbon fatty acid myristate to the amino-terminal glycine residue (10, 35). Transient formation of a cytosolic complex between pp6fiv-src and two cellular proteins, ppSO and pp9O, then occurs (5), and it has been proposed that this complex serves as a vehicle for delivering newly synthesized pp6o0-src to the plasma membrane (4, 13). The net result is that membrane association of myristylated pp6Ov-srC occurs within 15 min of synthesis (18).How does the pp6ov-src polypeptide interact with the phos...