The E26 avian leukemia virus encodes a transcriptional activator-type oncoprotein consisting of Gag, Myb, and Ets domains, and transforms early erythroid cells as well as myeloblasts. Surprisingly, we have found that "early erythroid" transformants obtained in culture are multipotent, since they can be induced to differentiate into myeloblasts and eosinophils after superinfection with retroviruses containing kinase-type or ras oncogenes. In addition, TPA is an efficient inducer that generates predominantly eosinophils at low concentrations and myeloblasts at high concentrations. The determination process involves the complete extinction of erythroid/thrombocytic markers and the subsequent activation of myelomonocytic/eosinophilic properties, including the acquisition of specific growth factor requirements. "Erythroleukemic" cells from virus-infected animals were likewise found to be multipotent, making this a unique system to study the genesis of stem cell leukemias and the molecular basis of lineage commitment during hematopoiesis.