Small DNA tumor viruses such as simian virus 40 (SV40) and polyomavirus (Py) take advantage of host cell proteins to transcribe and replicate their DNA. Interactions between the viral T antigens and host proteins result in cell transformation and tumor induction. Large T antigen of SV40 interacts with p53, pRb/p107/p130 family members, and the cyclic AMP-responsive element-binding protein (CREB)-binding protein (CBP)/p300. Py large T antigen is known to interact only with pRb and p300 among these proteins. Here we report that Py large T binds to CBP in vivo and in vitro. In co-transfection assays, Py large T inhibits the co-activation functions of CBP/p300 in CREB-mediated transactivation but not in NF-kappa B-mediated transactivation. p53 appears not to be involved in the functions of CREB-mediated transactivation and is not essential for large T:CBP interaction. Mutations introduced into a region of Py large T with homology to adenovirus E1A and SV40 large T prevent binding to the co-activators. These mutant large T antigens fail to inhibit CREB-mediated transactivation. The CBP/p300-binding Py mutants are able to transform established rat embryo fibroblasts but are restricted in their ability to induce tumors in the newborn mouse, indicating that interaction of large T with the co-activators may be essential for virus replication and spread in the intact host.