The in vitro transformation of normal T-lymphocytes by human T-cell leukemia/lymphoma virus (HTLV-I) is possible utilizing cocultivation techniques. We now report on a quantitative assay for HTLV-I transformation. Transformed cell lines were produced by cocultivation of either preactivated (phytohemagglutinin and T-cell growth factor) or nonactivated peripheral blood mononuclear cells with an equal number of lethally irradiated HTLV-I-positive donor cells (MT-2). After 14 days in liquid culture, transformed cells were plated in a 2-layer soft agarose system with or without T-cell growth factor (TCGF). Colony formation among 50 normal controls was observed at varying efficiencies with a mean number of 179 colonies (range, 6-599) in the presence of TCGF (up to a 2-log difference). The day 14 T-cell cultures demonstrated relatively low colony-forming efficiencies (less than or equal to 0.1%) and enhanced colony formation in the presence of TCGF. Day 14 after cocultivation was chosen for this assay based on a dose-response relationship between colony formation and the virus-positive donor cell inoculum and the known kinetics of colony growth of normal activated T-cells. An analysis of individual colonies indicated that they were of target cell origin and HTLV-I positive. Recombinant beta-interferon in increasing concentrations caused a decrease in colony formation as measured in this assay. Long-term cell cultures (2-18 months) showed higher colony-forming efficiencies (up to 1.0%) which were not enhanced by TCGF. The ability to quantitatively evaluate transformation via colony counts will provide an opportunity to study differences in transforming efficiencies attributable to varying target cells, donor cells, or blocking factors such as interferons, drugs, or anti-HTLV-I antibodies.