Fusion proteins created by chromosomal abnormalities are key components of mesenchymal cancer development. The most common chromosomal translocation in liposarcomas, t(12;16)(q13;p11), creates the FUS-CHOP fusion gene. In the past, we generated FUS-CHOP and CHOP transgenic mice and have shown that while FUS-CHOP transgenic develop liposarcomas, mice expressing CHOP, which lacks the FUS domain, display essentially normal white adipose tissue (WAT) development, suggesting that the FUS domain of FUS-CHOP plays a specific and critical role in the pathogenesis of liposarcoma. To test the significance of FUS and CHOP domain interactions within a living mouse, we generated mice expressing the FUS domain and crossed them with CHOP-transgenic mice to generate double-transgenic FUSxCHOP animals. Here we report that expression of the FUS domain restores liposarcoma development in CHOP-transgenic mice. Our results provide genetic evidence that FUS and CHOP domains function in trans for the mutual restoration of liposarcoma. These results identify a new mechanism of tumor-associated fusion genes and might have impact beyond myxoid liposarcoma.