The envelope protein (gp52) of Friend spleen focus-forming virus (F-SFFV) is defective in its intracellular transport and accumulates in the rough endoplasmic reticulum of F-SFFV-infected cells. This defect in transport has been attributed to the lack of a cytoplasmic domain, and possible loss of signals required for transport to the cell surface. The mature form of gp52, designated gp65, is also reported to be secreted from SFFV-infected cells. To determine the specific changes in the envelope protein which may lead to its lack of transport and to its lack of stability in associating with membranes, the 3' end of the F-SFFV envelope gene, which encodes the transmembrane domain, was inserted in place of the normal 3' end of the Friend murine leukemia virus genome. This chimeric envelope gene was expressed using the vaccinia virus expression system. The chimeric gp70/p15E glycoprotein molecule lacks the cytoplasmic tail residues and as a consequence is about 3300 daltons smaller. The chimeric PrEnv molecule was found to be cleaved efficiently as indicated by pulse-chase experiments. Immunofluorescence studies demonstrate that the chimeric molecule is efficiently transported to the surface of cells, unlike the SFFV gp52 glycoprotein. The chimeric molecule was found to be unstable in its membrane association and is released into the culture medium. These results indicate that the changes in the membrane spanning region and the lack of a cytoplasmic tail do not determine the defective transport of gp52, but may determine the stability of its association with membranes.