The TEL/PDGFbetaR gene, which encodes a fusion protein containing the ETS-family member TEL fused to the protein-tyrosine kinase domain of the platelet-derived growth factor receptor-beta (PDGFbetaR), confers interleukin 3 (IL-3)-independent growth on Ba/F3 hematopoietic cells. TEL/PDGFbetaR mutants have been generated that contain tyrosine-to-phenylalanine (Tyr-->Phe) substitutions at phosphorylation sites present in the native PDGFbetaR to assess the role of these sites in cell transformation by TEL/PDGFbetaR. Similar to previous findings in a murine bone marrow transplantation model, full transformation of Ba/F3 cells to IL-3-independent survival and proliferation required the TEL/PDGFbetaR juxtamembrane and carboxy terminal phosphorylation sites. In contrast to previous reports concerning comparable mutants in the native PDGFbetaR, each of the TEL/PDGFbetaR mutants is fully active as a protein-tyrosine kinase. Expression of the TEL/PDGFbetaR fusion protein causes hyperphosphorylation and activation of signal transducer and activator of transcription (STAT5), and this activation of STAT5 requires the juxtamembrane Tyr579 and Tyr581 in the TEL/PDGFbetaR fusion. Hyperphosphosphorylation of phospholipase Cgamma (PLCgamma) and the p85 subunit of phosphatidylinositol 3-kinase (PI3K) requires the carboxy terminal tyrosine residues of TEL/PDGFbetaR. Thus, full transformation of Ba/F3 cells by TEL/PDGFbetaR requires engagement of PI3K and PLCgamma and activation of STAT5. Taken together with the growth properties of cells transformed by the TEL/PDGFbetaR variants, these findings indicate that a minimal combination of these signaling intermediates contributes to hematopoietic transformation by the wild-type TEL/PDGFbetaR fusion. (Blood. 2001;98:3390-3397)