A single missense mutation in the human erbB-2 proto-oncogene (HER2N) efficiently transforms cultured NIH/3T3 fibroblasts. The transforming allele (HER2VE) contains a glutamic acid residue at position 659, instead of a valine, in the transmembrane region of the growth factor receptor. Receptor action is dependent on oligomerization. We have investigated the ability of erbB-2 gene variants with mutations in the intracellular tyrosine kinase domain to revert the transformed phenotype of cells. These variants most likely form hetero-oligomers with the transforming oncogene. Two receptor variants were constructed and introduced into cells expressing the oncogenic form of the human erbB-2 gene, HER2VE. The mutant HER2N delta contains a deletion of a large part of the kinase domain including the ATP binding site. This mutant had no effect on the growth of transformed cells, although it was found to interact with HER2VE. HER2N delta is phosphorylated in the presence, but not in the absence of HER2VE. A second mutant was constructed, HER2VEK753A, which contains both a mutation in the transmembrane region and a mutation in the ATP binding site of the kinase domain. This mutant led to a reversion of the transformed phenotype and significantly decreased growth in soft agar of HER2VE transformed cells. A concomitant increase in phosphorylated receptors was observed. These results indicate that an intact kinase domain is required for the oncogenic action of HER2VE and that transformation parameters can be suppressed by kinase domain mutants.