Genomic DNA of a Ewing's sarcoma cell line and pKOneo were cotransfected into NIH3T3 cells and assayed for tumorigenicity in nude mice. Primary transfected tumors all contained human DNA. One transfected sequence was retained through secondary and tertiary tumors, and was cloned in four overlapping cosmids covering 51.5-kb human DNA flanked on both sides with mouse DNA. The cloned sequence, though continuous in transfected tumors, originated from three major genetic elements discontiguous in human cells and recombined during transfection. Accordingly there was one species of hybrid RNA transcripts of 9 kb in the transfected tumors and no transcripts in human cells, including Ewing's sarcoma cells. Evidence that the cloned sequence is a biologically active novel oncogene was provided by transfection of a mixture of two cosmid clones which generated tumors where they were transcribed into 9-kb RNA. The oncogene was named tre to designate its origin from transfection recombined DNA molecules.