Comparative sequence analysis of the hemagglutinin (HA) genes of a highly virulent H5N8 virus isolated from turkeys in Ireland in 1983 and a virus of the same subtype detected simultaneously in healthy ducks showed only four amino acid differences between these strains. Partial sequencing of six of the other genes and antigenic similarity of the neuraminidases established the overall genetic similarity of these two viruses. Comparison of the complete sequence of two H5 gene sequences and partial sequences of other virulent and avirulent H5 viruses provides evidence for at least two different lineages of H5 influenza virus in the world, one in Europe and the other in North America, with virulent and avirulent members in each group. In vivo studies in domestic ducks showed that all of the H5 viruses that are virulent in chickens and turkeys replicate in the internal organs of ducks but did not produce any disease signs. Additionally, both viruses isolated from turkeys and ducks in Ireland were detected in the blood. These studies provide the first conclusive evidence for the possibility that fully virulent influenza viruses in domestic poultry can arise directly from viruses in wild aquatic birds. Studies on the cleavability of the HA of virulent and avirulent H5 viruses showed that the principles established for H7 viruses (F. X. Bosch, M. Orlich, H. D. Klenk, and R. Rott, 1979, Virology 95, 197-207; F. X. Bosch, W. Garten, H. D. Klenk, and R. Rott, 1981, Virology 113, 725-735) also apply to the H5 subtype. These are (1) only the HAs of virulent influenza viruses were cleaved in tissue culture in the absence of trypsin and (2) virulent H5 influenza viruses contain a series of basic amino acids at the cleavage site of the HA, whereas avirulent strains contain only a single arginine with the exception of the avirulent Chicken/Pennsylvania virus. Thus, a series of basic amino acids at the cleavage site probably forms a recognition site for the enzyme(s) responsible for cleavage.