Vascular endothelial growth factor (VEGF)--also known as vascular permeability factor--has been implicated in the regulation of blood vessel formation, i.e., vasculogenesis and angiogenesis. High amounts of VEGF mRNA and protein have been detected during embryonic and tumor angiogenesis, but it remained unclear whether the level of VEGF correlated with the extent of vascularization in a given organ or tissue. We examined the role of VEGF and the high affinity, signal-transducing VEGF receptor-2 (flk-1) in the avian embryo. In a gain of function transgene-like approach the retroviral expression vector RCAS was used to increase the level of quail VEGF during critical periods of avian limb bud growth and morphogenesis. In contrast to basic fibroblast growth factor, which recently was demonstrated to induce morphogenetic alterations when overexpressed in this system, overexpression of VEGF in the limb bud exclusively resulted in hypervascularization as reflected by an increase in vascular density. However, cartilage expressing the construct was not vascularized prematurely. Thus hypervascularization was probably due to the augmentation of the VEGF signaling mechanism in a permissive environment. In addition to hypervascularization, vascular permeability was dramatically increased, leading to local and in some cases to general edema. This is the first indication of a link between the functions of VEGF as a vascular growth factor and as a permeability factor. VEGF receptor-2 (flk-1) was found to be upregulated only in those areas where VEGF was overexpressed. This implies a positive feedback system of the VEGF receptor on its own synthesis and would provide a basis for a paracrine system in which ligand concentration is critical for the extent of tissue vascularization. Our results show that the VEGF/VEGF-receptor system is specific and sufficient for the formation of new blood vessels. They also have implications for somatic gene therapy of diseases which are characterized by a lack of blood vessels such as chronic ischemic diseases of heart and brain.