Several members of the family Circoviridae have been shown to encode proteins with apoptotic activity. For example, both porcine circovirus type 2 (PCV2) and chicken anemia virus (CAV) encode a third viral protein (VP3) that has been shown to be cytotoxic. Interestingly, in the case of the CAV protein (designated apoptin), apoptosis is specific to transformed cell types. Similarities in genome structure and organization suggest that PCV type 1 (PCV1) may also contain a third ORF, which codes for a protein with homologous activity. To investigate this, ORF prediction followed by gene expression analyses were conducted on a gene found to be homologous to CAV and PCV2 VP3. Our data presented herein elucidate a putative ORF3 that codes for a viral protein with functional similarity to that of apoptin and PCV2 VP3. Unlike its homologues, sequence analysis revealed a highly hydrophobic, extended C-terminal domain in PCV1 VP3, which harbours a strong nuclear export signal. Subcellular localization analysis demonstrated divergent PCV1 VP3 localization patterns compared with that of CAV VP3. Interestingly, cytotoxicity studies revealed evidence that apoptosis may be selective to transformed cell types, similar to apoptin; however, PCV1 VP3 induced a dramatic G1 cell cycle arrest as opposed to the G2/M arrest observed with apoptin. These results indicate that nuclear localization of PCV1 VP3 is necessary neither for induction of apoptosis nor for transformed cell selectivity, and suggest a mechanism of action distinct from that of apoptin.