Infection of Epstein-Barr virus-negative human B-lymphoma cell lines with the fully transforming B95.8 Epstein-Barr virus strain was associated with complete virus latent gene expression and a change in the cell surface and growth phenotype toward that of in vitro-transformed lymphoblastoid cell lines. In contrast, the cells infected with the P3HR1 Epstein-Barr virus strain, a deletion mutant that cannot encode Epstein-Barr nuclear antigen 2 (EBNA2) or a full-length EBNA-LP, expressed EBNAs1, 3a, 3b, and 3c but were negative for the latent membrane protein (LMP) and showed no change in cellular phenotype. This suggests that EBNA2 and/or EBNA-LP may be required for subsequent expression of LMP in Epstein-Barr virus-infected B cells. Recombinant vectors capable of expressing the B95.8 EBNA2A protein were introduced by electroporation into two P3HR1-converted B-lymphoma cell lines, BL30/P3 and BL41/P3. In both cases, stable expression of EBNA2A was accompanied by activation of LMP expression from the resident P3HR1 genome; control transfectants that did not express the EBNA2A protein never showed induction of LMP. In further experiments, a recombinant vector capable of expressing the full-length B95.8 EBNA-LP was introduced into the same target lines. Strong EBNA-LP expression was consistently observed in the transfected clones but was never accompanied by induction of LMP. The EBNA2A gene transfectants expressing EBNA2A and LMP showed a dramatic change in cell surface and growth phenotype toward a pattern like that of lymphoblastoid cell lines; some but not all of these changes could be reproduced in the absence of EBNA2A by transfection of P3HR1-converted cell lines with a recombinant vector expressing LMP. These studies suggest that EBNA2 plays an important dual role in the process of B-cell activation to the lymphoblastoid phenotype; the protein can have a direct effect upon cellular gene expression and is also involved in activating the expression of a second virus-encoded effector protein, LMP.