An
in vitro
colony method capable of detecting spleen cells malignantly transformed by Friend leukemia virus is described. These colony-forming cells, which form large erythroid colonies (10
4
-10
5
cells) in methylcellulose, can be detected late after infection with either the anemia-inducing (FV-A) or polycythemia-inducing (FV-P) isolates of Friend virus. Colony formation by these cells is dependent only on fetal calf serum as an exogeneous growth factor. The presence of these colony-forming cells in FV-P-infected spleens could not be detected until at least 3 weeks after virus infection, even though the most rapid increase in spleen weight occurred earlier, between 1 and 2 weeks after infection. Thereafter, the numbers of colony-forming cells increased sharply up to 5 weeks after infection with FV-P, beyond which time the mice generally did not survive. After infection with FV-A, colony-forming cells were detected only at 8-12 weeks and their numbers generally increased thereafter. Permanent cell lines were established from a significant fraction of FV-P and FV-A-induced colonies, and these cell lines could be chemically induced to synthesize hemoglobin. All individual colonies produced complete Friend virus complex. However, virus production appeared to decline in at least some cell lines. Both FV-P- and FV-A-induced colonies contained cells capable of forming spleen colonies in irradiated recipients and subcutaneous tumors in unirradiated mice. Thus, the assay method described here appears to detect a unique class of malignant Friend virus-transformed cells that can be detected only in the advanced stages of Friend virus-induced erythroleukemia.