Viruses conditionally replicating in cancer cells form an attractive novel class of antitumoral agents. To engineer such viruses infectivity can be coupled with proteolytic activity of the target cell by modifying the envelope (Env) protein of murine leukaemia virus (MLV) with blocking domains that prevent cell entry unless they are cleaved off by tumour-associated proteases like the matrix metalloproteases (MMP). Here we show that MLV variants selectively spreading through MMP-positive cells can be evolved from virus libraries, in which a standard MMP-2 substrate peptide connecting the blocking domain CD40L with the Env protein was diversified. Passaging the virus library on human fibrosarcoma or glioma cell lines resulted in the selection of about 10 virus clones, of which the three most frequent ones were shown to become activated by MMPs and to be replication competent on MMP-positive cells only. On these cells, the selected linker peptides improved the spreading by several orders of magnitude in vitro, as well as in tumour xenografts in vivo, approaching the kinetic of the unmodified wild-type virus. The data suggest that retroviral protease substrate libraries form a potent tool for the engineering of viruses conditionally replicating in a given cancer cell type of interest. Gene Therapy (2005) 12, 918-926.