The addition of environmental agents (carcinogens) induces transformation that can be quantitated. Its frequency follows a linear relationship with dose and is consistent with a 'one hit' phenomenon. Transformed colonies produce transformed lines with attributes of neoplastic cells including production of tumors. The results parallel in vivo activity. Although, molecular analysis of most animal assay indicate the presence of activated oncogenes belonging to the ras family, ras activation is a low frequency event in the neoplastic conversion of Syrian hamster cells just as is found with human malignancies. In our analysis of 22 independently derived lines N-ras activation was found only with sodium bisulfite transformed lines. A novel oncogene named carcinogenesis promotion hamster (cph) because its association with the carcinogenic process has been identified. This resulted from focusing on Syrian hamster cells transformed with a single dose of 3-methylcholanthrene (MCA) and cosmid-rescue-techniques from a third-cycle NIH3T3 transformant obtained by sequential transfections of genomic DNA from MCA-initiated hamster fetal cells. cph transforms NIH3T3 cells and acts synergistically with Ha-ras to transform murine fibroblasts. Gene expression analysis using cph genomic fragments from normal and neoplastic cells identifies a number of transcripts including a major mRNA of 2.5 kb as well as several larger transcripts. cph is actively transcribed in different tissues and different species. In the hamster it is a single copy gene localized by FISH to the euchromatic short arm of the X chromosome, at region Xpa7. cph does not have any significant global homology to sequences deposited in date banks, confirming that it is a novel gene. The transforming gene codes for a truncated 246 amino acids whereas the normal cph has a residue of 469 amino acids. In conclusion cph oncogene is activated by a single point-mutation; its activation appears an important mechanism for the conversion of carcinogen treated hamster cells to malignancy and because homologous sequences occur in human DNA it may also be important to the neoplastic conversion of human cells.