To study the oncogenic activity of cyclin E in an in vivo system we generated transgenic mice expressing high levels of cyclin E in T-lymphocytes by using a construct containing the CD2 locus control region. These animals were neither predisposed to develop any tumors spontaneously nor showed an increased incidence when crossbred with Emu L-myc transgenic mice but developed hyperplasia in peripheral lymphoid organs at later age with an incidence of 27%. When treated with the DNA methylating carcinogen N-methylnitrosourea (MNU) that provokes the development of T-cell lymphomas, CD2-cyclin E transgenic animals came down with T-cell neoplasia showing a significant higher incidence (54%) than normal non transgenic controls (31%). In one of eight tumors that arose in normal MNU treated mice we could find an expected activating point mutation in the Ki-ras gene (12.5%). In contrast, the same mutation occurred in five of 16 tumors from CD2-cyclin E transgenic mice (31.2%). Whereas cyclin E overexpression alone did not lead to an increased CDK2 activity we observed in all tumors that emerged from either MNU treated normal mice or treated CD2-cyclin E transgenics a downregulation of p27KIP1 and a higher histone H1 kinase activity in CDK2 immunoprecipitates compared to normal tissue. These findings demonstrate that high level expression of cyclin E can predispose T-cells for hyperplasia and malignant transformation. However, the results also suggest that this activity of cyclin E is manifest only when other cooperating oncogenes in particular ras genes are present and activated. This would be consistent with our previous finding that cyclin E and Ha-Ras cooperate in focus formation assays in rat embryo fibroblasts.